Correlation Between NFC Indonesia and Indosterling Technomedia
Can any of the company-specific risk be diversified away by investing in both NFC Indonesia and Indosterling Technomedia 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 Indosterling Technomedia 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 Indosterling Technomedia Tbk, you can compare the effects of market volatilities on NFC Indonesia and Indosterling Technomedia 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 Indosterling Technomedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of NFC Indonesia and Indosterling Technomedia.
Diversification Opportunities for NFC Indonesia and Indosterling Technomedia
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between NFC and Indosterling is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding NFC Indonesia PT and Indosterling Technomedia Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indosterling Technomedia 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 Indosterling Technomedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indosterling Technomedia has no effect on the direction of NFC Indonesia i.e., NFC Indonesia and Indosterling Technomedia go up and down completely randomly.
Pair Corralation between NFC Indonesia and Indosterling Technomedia
If you would invest 104,500 in NFC Indonesia PT on August 25, 2024 and sell it today you would earn a total of 40,500 from holding NFC Indonesia PT or generate 38.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
NFC Indonesia PT vs. Indosterling Technomedia Tbk
Performance |
| Timeline |
| NFC Indonesia PT |
| Indosterling Technomedia |
NFC Indonesia and Indosterling Technomedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NFC Indonesia and Indosterling Technomedia
The main advantage of trading using opposite NFC Indonesia and Indosterling Technomedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NFC Indonesia position performs unexpectedly, Indosterling Technomedia 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 Indosterling Technomedia will offset losses from the drop in Indosterling Technomedia'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 |
| Indosterling Technomedia vs. Multipolar Technology Tbk | Indosterling Technomedia vs. Digital Mediatama Maxima | Indosterling Technomedia vs. M Cash Integrasi | Indosterling Technomedia vs. NFC Indonesia 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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