Correlation Between Mitra Pinasthika and Merdeka Copper
Can any of the company-specific risk be diversified away by investing in both Mitra Pinasthika and Merdeka Copper 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 Merdeka Copper 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 Merdeka Copper Gold, you can compare the effects of market volatilities on Mitra Pinasthika and Merdeka Copper 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 Merdeka Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mitra Pinasthika and Merdeka Copper.
Diversification Opportunities for Mitra Pinasthika and Merdeka Copper
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mitra and Merdeka is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Mitra Pinasthika Mustika and Merdeka Copper Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Merdeka Copper Gold 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 Merdeka Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Merdeka Copper Gold has no effect on the direction of Mitra Pinasthika i.e., Mitra Pinasthika and Merdeka Copper go up and down completely randomly.
Pair Corralation between Mitra Pinasthika and Merdeka Copper
Assuming the 90 days trading horizon Mitra Pinasthika Mustika is expected to generate 0.22 times more return on investment than Merdeka Copper. However, Mitra Pinasthika Mustika is 4.46 times less risky than Merdeka Copper. It trades about -0.28 of its potential returns per unit of risk. Merdeka Copper Gold is currently generating about -0.46 per unit of risk. If you would invest 102,500 in Mitra Pinasthika Mustika on August 31, 2024 and sell it today you would lose (3,000) from holding Mitra Pinasthika Mustika or give up 2.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mitra Pinasthika Mustika vs. Merdeka Copper Gold
Performance |
| Timeline |
| Mitra Pinasthika Mustika |
| Merdeka Copper Gold |
Mitra Pinasthika and Merdeka Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mitra Pinasthika and Merdeka Copper
The main advantage of trading using opposite Mitra Pinasthika and Merdeka Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mitra Pinasthika position performs unexpectedly, Merdeka Copper 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 Merdeka Copper will offset losses from the drop in Merdeka Copper'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 |
| Merdeka Copper vs. Perusahaan Gas Negara | Merdeka Copper vs. Vale Indonesia Tbk | Merdeka Copper vs. Telkom Indonesia Tbk | Merdeka Copper 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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