Correlation Between Maskapai Reasuransi and Victoria Insurance
Can any of the company-specific risk be diversified away by investing in both Maskapai Reasuransi and Victoria Insurance 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 Maskapai Reasuransi and Victoria Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maskapai Reasuransi Indonesia and Victoria Insurance Tbk, you can compare the effects of market volatilities on Maskapai Reasuransi and Victoria Insurance 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 Maskapai Reasuransi with a short position of Victoria Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maskapai Reasuransi and Victoria Insurance.
Diversification Opportunities for Maskapai Reasuransi and Victoria Insurance
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Maskapai and Victoria is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Maskapai Reasuransi Indonesia and Victoria Insurance Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Victoria Insurance Tbk and Maskapai Reasuransi 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 Maskapai Reasuransi Indonesia are associated (or correlated) with Victoria Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Victoria Insurance Tbk has no effect on the direction of Maskapai Reasuransi i.e., Maskapai Reasuransi and Victoria Insurance go up and down completely randomly.
Pair Corralation between Maskapai Reasuransi and Victoria Insurance
Assuming the 90 days trading horizon Maskapai Reasuransi Indonesia is expected to generate 1.1 times more return on investment than Victoria Insurance. However, Maskapai Reasuransi is 1.1 times more volatile than Victoria Insurance Tbk. It trades about 0.16 of its potential returns per unit of risk. Victoria Insurance Tbk is currently generating about -0.1 per unit of risk. If you would invest 86,000 in Maskapai Reasuransi Indonesia on October 22, 2024 and sell it today you would earn a total of 4,000 from holding Maskapai Reasuransi Indonesia or generate 4.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maskapai Reasuransi Indonesia vs. Victoria Insurance Tbk
Performance |
| Timeline |
| Maskapai Reasuransi |
| Victoria Insurance Tbk |
Maskapai Reasuransi and Victoria Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maskapai Reasuransi and Victoria Insurance
The main advantage of trading using opposite Maskapai Reasuransi and Victoria Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maskapai Reasuransi position performs unexpectedly, Victoria Insurance 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 Victoria Insurance will offset losses from the drop in Victoria Insurance's long position.| Maskapai Reasuransi vs. Lippo General Insurance | Maskapai Reasuransi vs. Paninvest Tbk | Maskapai Reasuransi vs. Mandala Multifinance Tbk | Maskapai Reasuransi vs. Bank Mayapada Internasional |
| Victoria Insurance vs. Trimegah Securities Tbk | Victoria Insurance vs. Trust Finance Indonesia | Victoria Insurance vs. Panca Global Securities | Victoria Insurance vs. Wahana Ottomitra Multiartha |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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