Correlation Between PT Bumi and Morien Resources
Can any of the company-specific risk be diversified away by investing in both PT Bumi and Morien Resources 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 PT Bumi and Morien Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Bumi Resources and Morien Resources Corp, you can compare the effects of market volatilities on PT Bumi and Morien Resources 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 PT Bumi with a short position of Morien Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bumi and Morien Resources.
Diversification Opportunities for PT Bumi and Morien Resources
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PBMRF and Morien is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding PT Bumi Resources and Morien Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Morien Resources Corp and PT Bumi 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 PT Bumi Resources are associated (or correlated) with Morien Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Morien Resources Corp has no effect on the direction of PT Bumi i.e., PT Bumi and Morien Resources go up and down completely randomly.
Pair Corralation between PT Bumi and Morien Resources
If you would invest 18.00 in Morien Resources Corp on August 27, 2024 and sell it today you would earn a total of 1.00 from holding Morien Resources Corp or generate 5.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bumi Resources vs. Morien Resources Corp
Performance |
| Timeline |
| PT Bumi Resources |
| Morien Resources Corp |
PT Bumi and Morien Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bumi and Morien Resources
The main advantage of trading using opposite PT Bumi and Morien Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bumi position performs unexpectedly, Morien Resources 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 Morien Resources will offset losses from the drop in Morien Resources' long position.The idea behind PT Bumi Resources and Morien Resources Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Morien Resources vs. Alliance Resource Partners | Morien Resources vs. Astera Labs, Common | Morien Resources vs. Autodesk | Morien Resources vs. Applied Blockchain |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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