Correlation Between NFC Indonesia and PT Mulia
Can any of the company-specific risk be diversified away by investing in both NFC Indonesia and PT Mulia 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 NFC Indonesia and PT Mulia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NFC Indonesia PT and PT Mulia Industrindo, you can compare the effects of market volatilities on NFC Indonesia and PT Mulia 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 NFC Indonesia with a short position of PT Mulia. Check out your portfolio center. Please also check ongoing floating volatility patterns of NFC Indonesia and PT Mulia.
Diversification Opportunities for NFC Indonesia and PT Mulia
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NFC and MLIA is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding NFC Indonesia PT and PT Mulia Industrindo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Mulia Industrindo and NFC Indonesia 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 NFC Indonesia PT are associated (or correlated) with PT Mulia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Mulia Industrindo has no effect on the direction of NFC Indonesia i.e., NFC Indonesia and PT Mulia go up and down completely randomly.
Pair Corralation between NFC Indonesia and PT Mulia
Assuming the 90 days trading horizon NFC Indonesia PT is expected to under-perform the PT Mulia. In addition to that, NFC Indonesia is 4.81 times more volatile than PT Mulia Industrindo. It trades about -0.13 of its total potential returns per unit of risk. PT Mulia Industrindo is currently generating about -0.23 per unit of volatility. If you would invest 36,000 in PT Mulia Industrindo on September 2, 2024 and sell it today you would lose (4,800) from holding PT Mulia Industrindo or give up 13.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NFC Indonesia PT vs. PT Mulia Industrindo
Performance |
| Timeline |
| NFC Indonesia PT |
| PT Mulia Industrindo |
NFC Indonesia and PT Mulia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NFC Indonesia and PT Mulia
The main advantage of trading using opposite NFC Indonesia and PT Mulia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NFC Indonesia position performs unexpectedly, PT Mulia 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 Mulia will offset losses from the drop in PT Mulia's long position.| NFC Indonesia vs. M Cash Integrasi | NFC Indonesia vs. Nusantara Voucher Distribution | NFC Indonesia vs. Digital Mediatama Maxima | NFC Indonesia vs. Multipolar Technology Tbk |
| PT Mulia vs. Suparma Tbk | PT Mulia vs. Pelangi Indah Canindo | PT Mulia vs. Surya Toto Indonesia | PT Mulia vs. Lautan Luas 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |