Correlation Between Mitra Pinasthika and Timah Persero
Can any of the company-specific risk be diversified away by investing in both Mitra Pinasthika and Timah Persero 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 Timah Persero 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 Timah Persero Tbk, you can compare the effects of market volatilities on Mitra Pinasthika and Timah Persero 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 Timah Persero. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mitra Pinasthika and Timah Persero.
Diversification Opportunities for Mitra Pinasthika and Timah Persero
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mitra and Timah is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Mitra Pinasthika Mustika and Timah Persero Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Timah Persero 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 Timah Persero. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Timah Persero Tbk has no effect on the direction of Mitra Pinasthika i.e., Mitra Pinasthika and Timah Persero go up and down completely randomly.
Pair Corralation between Mitra Pinasthika and Timah Persero
Assuming the 90 days trading horizon Mitra Pinasthika is expected to generate 3.99 times less return on investment than Timah Persero. But when comparing it to its historical volatility, Mitra Pinasthika Mustika is 3.66 times less risky than Timah Persero. It trades about 0.03 of its potential returns per unit of risk. Timah Persero Tbk is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 88,000 in Timah Persero Tbk on September 3, 2024 and sell it today you would earn a total of 16,500 from holding Timah Persero Tbk or generate 18.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mitra Pinasthika Mustika vs. Timah Persero Tbk
Performance |
| Timeline |
| Mitra Pinasthika Mustika |
| Timah Persero Tbk |
Mitra Pinasthika and Timah Persero Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mitra Pinasthika and Timah Persero
The main advantage of trading using opposite Mitra Pinasthika and Timah Persero positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mitra Pinasthika position performs unexpectedly, Timah Persero 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 Timah Persero will offset losses from the drop in Timah Persero'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 |
| Timah Persero vs. Vale Indonesia Tbk | Timah Persero vs. Aneka Tambang Persero | Timah Persero vs. Bukit Asam Tbk | Timah Persero vs. Perusahaan Gas Negara |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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