Correlation Between Prodia Widyahusada and Mark Dynamics
Can any of the company-specific risk be diversified away by investing in both Prodia Widyahusada and Mark Dynamics 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 Prodia Widyahusada and Mark Dynamics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prodia Widyahusada Tbk and Mark Dynamics Indonesia, you can compare the effects of market volatilities on Prodia Widyahusada and Mark Dynamics 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 Prodia Widyahusada with a short position of Mark Dynamics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prodia Widyahusada and Mark Dynamics.
Diversification Opportunities for Prodia Widyahusada and Mark Dynamics
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Prodia and Mark is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Prodia Widyahusada Tbk and Mark Dynamics Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mark Dynamics Indonesia and Prodia Widyahusada 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 Prodia Widyahusada Tbk are associated (or correlated) with Mark Dynamics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mark Dynamics Indonesia has no effect on the direction of Prodia Widyahusada i.e., Prodia Widyahusada and Mark Dynamics go up and down completely randomly.
Pair Corralation between Prodia Widyahusada and Mark Dynamics
Assuming the 90 days trading horizon Prodia Widyahusada Tbk is expected to under-perform the Mark Dynamics. But the stock apears to be less risky and, when comparing its historical volatility, Prodia Widyahusada Tbk is 1.66 times less risky than Mark Dynamics. The stock trades about -0.25 of its potential returns per unit of risk. The Mark Dynamics Indonesia is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 108,896 in Mark Dynamics Indonesia on August 25, 2024 and sell it today you would lose (5,896) from holding Mark Dynamics Indonesia or give up 5.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prodia Widyahusada Tbk vs. Mark Dynamics Indonesia
Performance |
| Timeline |
| Prodia Widyahusada Tbk |
| Mark Dynamics Indonesia |
Prodia Widyahusada and Mark Dynamics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prodia Widyahusada and Mark Dynamics
The main advantage of trading using opposite Prodia Widyahusada and Mark Dynamics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prodia Widyahusada position performs unexpectedly, Mark Dynamics 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 Mark Dynamics will offset losses from the drop in Mark Dynamics' long position.| Prodia Widyahusada vs. Medikaloka Hermina PT | Prodia Widyahusada vs. Mitra Keluarga Karyasehat | Prodia Widyahusada vs. Siloam International Hospitals | Prodia Widyahusada vs. Saratoga Investama Sedaya |
| Mark Dynamics vs. Samudera Indonesia Tbk | Mark Dynamics vs. Rukun Raharja Tbk | Mark Dynamics vs. PT Temas Tbk | Mark Dynamics vs. Weha Transportasi Indonesia |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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