Correlation Between Mitra Pinasthika and Duta Pertiwi
Can any of the company-specific risk be diversified away by investing in both Mitra Pinasthika and Duta Pertiwi at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Mitra Pinasthika and Duta Pertiwi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mitra Pinasthika Mustika and Duta Pertiwi Tbk, you can compare the effects of market volatilities on Mitra Pinasthika and Duta Pertiwi and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Mitra Pinasthika with a short position of Duta Pertiwi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mitra Pinasthika and Duta Pertiwi.
Diversification Opportunities for Mitra Pinasthika and Duta Pertiwi
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mitra and Duta is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Mitra Pinasthika Mustika and Duta Pertiwi Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Duta Pertiwi Tbk and Mitra Pinasthika is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Mitra Pinasthika Mustika are associated (or correlated) with Duta Pertiwi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Duta Pertiwi Tbk has no effect on the direction of Mitra Pinasthika i.e., Mitra Pinasthika and Duta Pertiwi go up and down completely randomly.
Pair Corralation between Mitra Pinasthika and Duta Pertiwi
Assuming the 90 days trading horizon Mitra Pinasthika Mustika is expected to under-perform the Duta Pertiwi. But the stock apears to be less risky and, when comparing its historical volatility, Mitra Pinasthika Mustika is 6.14 times less risky than Duta Pertiwi. The stock trades about -0.28 of its potential returns per unit of risk. The Duta Pertiwi Tbk is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 404,000 in Duta Pertiwi Tbk on August 31, 2024 and sell it today you would lose (7,000) from holding Duta Pertiwi Tbk or give up 1.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mitra Pinasthika Mustika vs. Duta Pertiwi Tbk
Performance |
| Timeline |
| Mitra Pinasthika Mustika |
| Duta Pertiwi Tbk |
Mitra Pinasthika and Duta Pertiwi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mitra Pinasthika and Duta Pertiwi
The main advantage of trading using opposite Mitra Pinasthika and Duta Pertiwi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mitra Pinasthika position performs unexpectedly, Duta Pertiwi can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Duta Pertiwi will offset losses from the drop in Duta Pertiwi's long position.| Mitra Pinasthika vs. Saratoga Investama Sedaya | Mitra Pinasthika vs. Puradelta Lestari PT | Mitra Pinasthika vs. Cikarang Listrindo Tbk | Mitra Pinasthika vs. Erajaya Swasembada Tbk |
| Duta Pertiwi vs. Lippo Cikarang Tbk | Duta Pertiwi vs. Lippo Karawaci Tbk | Duta Pertiwi vs. Intiland Development Tbk | Duta Pertiwi vs. Mitra Pinasthika Mustika |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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