Correlation Between Minna Padi and Prodia Widyahusada
Can any of the company-specific risk be diversified away by investing in both Minna Padi and Prodia Widyahusada 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 Minna Padi and Prodia Widyahusada into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Minna Padi Investama and Prodia Widyahusada Tbk, you can compare the effects of market volatilities on Minna Padi and Prodia Widyahusada 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 Minna Padi with a short position of Prodia Widyahusada. Check out your portfolio center. Please also check ongoing floating volatility patterns of Minna Padi and Prodia Widyahusada.
Diversification Opportunities for Minna Padi and Prodia Widyahusada
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Minna and Prodia is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Minna Padi Investama and Prodia Widyahusada Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prodia Widyahusada Tbk and Minna Padi 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 Minna Padi Investama are associated (or correlated) with Prodia Widyahusada. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prodia Widyahusada Tbk has no effect on the direction of Minna Padi i.e., Minna Padi and Prodia Widyahusada go up and down completely randomly.
Pair Corralation between Minna Padi and Prodia Widyahusada
Assuming the 90 days trading horizon Minna Padi Investama is expected to under-perform the Prodia Widyahusada. In addition to that, Minna Padi is 2.77 times more volatile than Prodia Widyahusada Tbk. It trades about -0.02 of its total potential returns per unit of risk. Prodia Widyahusada Tbk is currently generating about -0.05 per unit of volatility. If you would invest 546,137 in Prodia Widyahusada Tbk on August 28, 2024 and sell it today you would lose (268,137) from holding Prodia Widyahusada Tbk or give up 49.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Minna Padi Investama vs. Prodia Widyahusada Tbk
Performance |
| Timeline |
| Minna Padi Investama |
| Prodia Widyahusada Tbk |
Minna Padi and Prodia Widyahusada Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Minna Padi and Prodia Widyahusada
The main advantage of trading using opposite Minna Padi and Prodia Widyahusada positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Minna Padi position performs unexpectedly, Prodia Widyahusada 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 Prodia Widyahusada will offset losses from the drop in Prodia Widyahusada's long position.| Minna Padi vs. Panca Global Securities | Minna Padi vs. Panin Sekuritas Tbk | Minna Padi vs. Reliance Securities Tbk | Minna Padi vs. Bank Nationalnobu Tbk |
| Prodia Widyahusada vs. Astra Graphia Tbk | Prodia Widyahusada vs. Hexindo Adiperkasa Tbk | Prodia Widyahusada vs. Lautan Luas Tbk | Prodia Widyahusada vs. Citra Marga Nusaphala |
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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