Correlation Between Metrodata Electronics and Hoffmen Cleanindo
Can any of the company-specific risk be diversified away by investing in both Metrodata Electronics and Hoffmen Cleanindo 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 Hoffmen Cleanindo 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 Hoffmen Cleanindo, you can compare the effects of market volatilities on Metrodata Electronics and Hoffmen Cleanindo 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 Hoffmen Cleanindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metrodata Electronics and Hoffmen Cleanindo.
Diversification Opportunities for Metrodata Electronics and Hoffmen Cleanindo
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Metrodata and Hoffmen is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Metrodata Electronics Tbk and Hoffmen Cleanindo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hoffmen Cleanindo 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 Hoffmen Cleanindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hoffmen Cleanindo has no effect on the direction of Metrodata Electronics i.e., Metrodata Electronics and Hoffmen Cleanindo go up and down completely randomly.
Pair Corralation between Metrodata Electronics and Hoffmen Cleanindo
Assuming the 90 days trading horizon Metrodata Electronics Tbk is expected to generate 0.47 times more return on investment than Hoffmen Cleanindo. However, Metrodata Electronics Tbk is 2.15 times less risky than Hoffmen Cleanindo. It trades about 0.04 of its potential returns per unit of risk. Hoffmen Cleanindo is currently generating about -0.02 per unit of risk. If you would invest 52,033 in Metrodata Electronics Tbk on August 31, 2024 and sell it today you would earn a total of 10,467 from holding Metrodata Electronics Tbk or generate 20.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.44% |
| Values | Daily Returns |
Metrodata Electronics Tbk vs. Hoffmen Cleanindo
Performance |
| Timeline |
| Metrodata Electronics Tbk |
| Hoffmen Cleanindo |
Metrodata Electronics and Hoffmen Cleanindo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metrodata Electronics and Hoffmen Cleanindo
The main advantage of trading using opposite Metrodata Electronics and Hoffmen Cleanindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metrodata Electronics position performs unexpectedly, Hoffmen Cleanindo 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 Hoffmen Cleanindo will offset losses from the drop in Hoffmen Cleanindo'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 |
| Hoffmen Cleanindo vs. Bank Central Asia | Hoffmen Cleanindo vs. Bank Rakyat Indonesia | Hoffmen Cleanindo vs. Bayan Resources Tbk | Hoffmen Cleanindo 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |