Correlation Between City Retail and Inocycle Technology
Can any of the company-specific risk be diversified away by investing in both City Retail and Inocycle Technology 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 City Retail and Inocycle Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between City Retail Developments and Inocycle Technology Tbk, you can compare the effects of market volatilities on City Retail and Inocycle Technology 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 City Retail with a short position of Inocycle Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of City Retail and Inocycle Technology.
Diversification Opportunities for City Retail and Inocycle Technology
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between City and Inocycle is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding City Retail Developments and Inocycle Technology Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inocycle Technology Tbk and City Retail 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 City Retail Developments are associated (or correlated) with Inocycle Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inocycle Technology Tbk has no effect on the direction of City Retail i.e., City Retail and Inocycle Technology go up and down completely randomly.
Pair Corralation between City Retail and Inocycle Technology
Assuming the 90 days trading horizon City Retail Developments is expected to generate 0.33 times more return on investment than Inocycle Technology. However, City Retail Developments is 3.07 times less risky than Inocycle Technology. It trades about 0.0 of its potential returns per unit of risk. Inocycle Technology Tbk is currently generating about -0.21 per unit of risk. If you would invest 13,500 in City Retail Developments on September 4, 2024 and sell it today you would earn a total of 0.00 from holding City Retail Developments or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
City Retail Developments vs. Inocycle Technology Tbk
Performance |
| Timeline |
| City Retail Developments |
| Inocycle Technology Tbk |
City Retail and Inocycle Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with City Retail and Inocycle Technology
The main advantage of trading using opposite City Retail and Inocycle Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if City Retail position performs unexpectedly, Inocycle Technology 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 Inocycle Technology will offset losses from the drop in Inocycle Technology's long position.| City Retail vs. Metropolitan Land Tbk | City Retail vs. Bekasi Fajar Industrial | City Retail vs. Greenwood Sejahtera Tbk | City Retail vs. Metropolitan Kentjana Tbk |
| Inocycle Technology vs. MNC Vision Networks | Inocycle Technology vs. Hartadinata Abadi Tbk | Inocycle Technology vs. Kencana Energi Lestari | Inocycle Technology vs. Bali Bintang Sejahtera |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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