Correlation Between Malacca Trust and Victoria Investama
Can any of the company-specific risk be diversified away by investing in both Malacca Trust and Victoria 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 Malacca Trust and Victoria Investama into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Malacca Trust Wuwungan and Victoria Investama Tbk, you can compare the effects of market volatilities on Malacca Trust and Victoria 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 Malacca Trust with a short position of Victoria Investama. Check out your portfolio center. Please also check ongoing floating volatility patterns of Malacca Trust and Victoria Investama.
Diversification Opportunities for Malacca Trust and Victoria Investama
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Malacca and Victoria is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Malacca Trust Wuwungan and Victoria Investama Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Victoria Investama Tbk and Malacca Trust 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 Malacca Trust Wuwungan are associated (or correlated) with Victoria Investama. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Victoria Investama Tbk has no effect on the direction of Malacca Trust i.e., Malacca Trust and Victoria Investama go up and down completely randomly.
Pair Corralation between Malacca Trust and Victoria Investama
Assuming the 90 days trading horizon Malacca Trust is expected to generate 3.42 times less return on investment than Victoria Investama. But when comparing it to its historical volatility, Malacca Trust Wuwungan is 4.17 times less risky than Victoria Investama. It trades about 0.19 of its potential returns per unit of risk. Victoria Investama Tbk is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 16,700 in Victoria Investama Tbk on August 30, 2024 and sell it today you would earn a total of 3,900 from holding Victoria Investama Tbk or generate 23.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Malacca Trust Wuwungan vs. Victoria Investama Tbk
Performance |
| Timeline |
| Malacca Trust Wuwungan |
| Victoria Investama Tbk |
Malacca Trust and Victoria Investama Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Malacca Trust and Victoria Investama
The main advantage of trading using opposite Malacca Trust and Victoria Investama positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Malacca Trust position performs unexpectedly, Victoria 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 Victoria Investama will offset losses from the drop in Victoria Investama's long position.| Malacca Trust vs. Bank Cimb Niaga | Malacca Trust vs. Indosat Tbk | Malacca Trust vs. Astra Agro Lestari | Malacca Trust vs. Bank Mandiri Persero |
| Victoria Investama vs. Victoria Insurance Tbk | Victoria Investama vs. Verena Multi Finance | Victoria Investama vs. Trimegah Securities Tbk | Victoria Investama vs. Tifa Finance 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |