Correlation Between Pertamina Geothermal and Mahaka Media
Can any of the company-specific risk be diversified away by investing in both Pertamina Geothermal and Mahaka Media 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 Pertamina Geothermal and Mahaka Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pertamina Geothermal Energy and Mahaka Media Tbk, you can compare the effects of market volatilities on Pertamina Geothermal and Mahaka Media 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 Pertamina Geothermal with a short position of Mahaka Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pertamina Geothermal and Mahaka Media.
Diversification Opportunities for Pertamina Geothermal and Mahaka Media
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Pertamina and Mahaka is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Pertamina Geothermal Energy and Mahaka Media Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mahaka Media Tbk and Pertamina Geothermal 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 Pertamina Geothermal Energy are associated (or correlated) with Mahaka Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mahaka Media Tbk has no effect on the direction of Pertamina Geothermal i.e., Pertamina Geothermal and Mahaka Media go up and down completely randomly.
Pair Corralation between Pertamina Geothermal and Mahaka Media
Assuming the 90 days trading horizon Pertamina Geothermal Energy is expected to under-perform the Mahaka Media. But the stock apears to be less risky and, when comparing its historical volatility, Pertamina Geothermal Energy is 1.38 times less risky than Mahaka Media. The stock trades about -0.22 of its potential returns per unit of risk. The Mahaka Media Tbk is currently generating about 0.45 of returns per unit of risk over similar time horizon. If you would invest 2,500 in Mahaka Media Tbk on October 23, 2024 and sell it today you would earn a total of 300.00 from holding Mahaka Media Tbk or generate 12.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pertamina Geothermal Energy vs. Mahaka Media Tbk
Performance |
| Timeline |
| Pertamina Geothermal |
| Mahaka Media Tbk |
Pertamina Geothermal and Mahaka Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pertamina Geothermal and Mahaka Media
The main advantage of trading using opposite Pertamina Geothermal and Mahaka Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pertamina Geothermal position performs unexpectedly, Mahaka Media 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 Mahaka Media will offset losses from the drop in Mahaka Media's long position.| Pertamina Geothermal vs. Metrodata Electronics Tbk | Pertamina Geothermal vs. Garuda Metalindo Tbk | Pertamina Geothermal vs. Indorama Synthetics Tbk | Pertamina Geothermal vs. First Media Tbk |
| Mahaka Media vs. Akbar Indomakmur Stimec | Mahaka Media vs. Bayu Buana Tbk | Mahaka Media vs. Centratama Telekomunikasi Ind | Mahaka Media vs. Fortune Indonesia 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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