Correlation Between Metrodata Electronics and PT Pelayaran
Can any of the company-specific risk be diversified away by investing in both Metrodata Electronics and PT Pelayaran 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 PT Pelayaran 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 PT Pelayaran Tamarin, you can compare the effects of market volatilities on Metrodata Electronics and PT Pelayaran 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 PT Pelayaran. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metrodata Electronics and PT Pelayaran.
Diversification Opportunities for Metrodata Electronics and PT Pelayaran
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Metrodata and TAMU is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Metrodata Electronics Tbk and PT Pelayaran Tamarin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Pelayaran Tamarin 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 PT Pelayaran. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Pelayaran Tamarin has no effect on the direction of Metrodata Electronics i.e., Metrodata Electronics and PT Pelayaran go up and down completely randomly.
Pair Corralation between Metrodata Electronics and PT Pelayaran
Assuming the 90 days trading horizon Metrodata Electronics is expected to generate 3.26 times less return on investment than PT Pelayaran. But when comparing it to its historical volatility, Metrodata Electronics Tbk is 2.87 times less risky than PT Pelayaran. It trades about 0.06 of its potential returns per unit of risk. PT Pelayaran Tamarin is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 800.00 in PT Pelayaran Tamarin on August 26, 2024 and sell it today you would earn a total of 600.00 from holding PT Pelayaran Tamarin or generate 75.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Metrodata Electronics Tbk vs. PT Pelayaran Tamarin
Performance |
| Timeline |
| Metrodata Electronics Tbk |
| PT Pelayaran Tamarin |
Metrodata Electronics and PT Pelayaran Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metrodata Electronics and PT Pelayaran
The main advantage of trading using opposite Metrodata Electronics and PT Pelayaran positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metrodata Electronics position performs unexpectedly, PT Pelayaran 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 PT Pelayaran will offset losses from the drop in PT Pelayaran'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 |
| PT Pelayaran vs. Communication Cable Systems | PT Pelayaran vs. Steel Pipe Industry | PT Pelayaran vs. Bekasi Fajar Industrial | PT Pelayaran vs. Metrodata Electronics Tbk |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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