Correlation Between Metrodata Electronics and Mnc Investama
Can any of the company-specific risk be diversified away by investing in both Metrodata Electronics and Mnc Investama 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 Metrodata Electronics and Mnc Investama into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Metrodata Electronics Tbk and Mnc Investama Tbk, you can compare the effects of market volatilities on Metrodata Electronics and Mnc Investama 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 Metrodata Electronics with a short position of Mnc Investama. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metrodata Electronics and Mnc Investama.
Diversification Opportunities for Metrodata Electronics and Mnc Investama
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Metrodata and Mnc is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Metrodata Electronics Tbk and Mnc Investama Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mnc Investama Tbk and Metrodata Electronics 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 Metrodata Electronics Tbk are associated (or correlated) with Mnc Investama. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mnc Investama Tbk has no effect on the direction of Metrodata Electronics i.e., Metrodata Electronics and Mnc Investama go up and down completely randomly.
Pair Corralation between Metrodata Electronics and Mnc Investama
Assuming the 90 days trading horizon Metrodata Electronics Tbk is expected to generate 0.5 times more return on investment than Mnc Investama. However, Metrodata Electronics Tbk is 2.01 times less risky than Mnc Investama. It trades about -0.06 of its potential returns per unit of risk. Mnc Investama Tbk is currently generating about -0.18 per unit of risk. If you would invest 63,000 in Metrodata Electronics Tbk on August 28, 2024 and sell it today you would lose (1,000.00) from holding Metrodata Electronics Tbk or give up 1.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Metrodata Electronics Tbk vs. Mnc Investama Tbk
Performance |
| Timeline |
| Metrodata Electronics Tbk |
| Mnc Investama Tbk |
Metrodata Electronics and Mnc Investama Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metrodata Electronics and Mnc Investama
The main advantage of trading using opposite Metrodata Electronics and Mnc Investama positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metrodata Electronics position performs unexpectedly, Mnc Investama 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 Mnc Investama will offset losses from the drop in Mnc Investama's long position.| Metrodata Electronics vs. Multipolar Tbk | Metrodata Electronics vs. Astra Graphia Tbk | Metrodata Electronics vs. Matahari Putra Prima | Metrodata Electronics vs. Ramayana Lestari Sentosa |
| Mnc Investama vs. Mnc Land Tbk | Mnc Investama vs. MNC Vision Networks | Mnc Investama vs. Medikaloka Hermina PT |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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