Correlation Between Mitra Pinasthika and PT Indofood
Can any of the company-specific risk be diversified away by investing in both Mitra Pinasthika and PT Indofood 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 PT Indofood 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 PT Indofood Sukses, you can compare the effects of market volatilities on Mitra Pinasthika and PT Indofood 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 PT Indofood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mitra Pinasthika and PT Indofood.
Diversification Opportunities for Mitra Pinasthika and PT Indofood
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Mitra and INDF is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Mitra Pinasthika Mustika and PT Indofood Sukses in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Indofood Sukses 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 PT Indofood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Indofood Sukses has no effect on the direction of Mitra Pinasthika i.e., Mitra Pinasthika and PT Indofood go up and down completely randomly.
Pair Corralation between Mitra Pinasthika and PT Indofood
Assuming the 90 days trading horizon Mitra Pinasthika is expected to generate 12.39 times less return on investment than PT Indofood. But when comparing it to its historical volatility, Mitra Pinasthika Mustika is 1.16 times less risky than PT Indofood. It trades about 0.0 of its potential returns per unit of risk. PT Indofood Sukses is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 565,904 in PT Indofood Sukses on December 1, 2024 and sell it today you would earn a total of 141,596 from holding PT Indofood Sukses or generate 25.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Mitra Pinasthika Mustika vs. PT Indofood Sukses
Performance |
| Timeline |
| Mitra Pinasthika Mustika |
| PT Indofood Sukses |
Mitra Pinasthika and PT Indofood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mitra Pinasthika and PT Indofood
The main advantage of trading using opposite Mitra Pinasthika and PT Indofood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mitra Pinasthika position performs unexpectedly, PT Indofood 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 PT Indofood will offset losses from the drop in PT Indofood'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 |
| PT Indofood vs. Astra International Tbk | PT Indofood vs. Unilever Indonesia Tbk | PT Indofood vs. Telkom Indonesia Tbk | PT Indofood vs. Bank Mandiri Persero |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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