Correlation Between Prodia Widyahusada and Multistrada Arah
Can any of the company-specific risk be diversified away by investing in both Prodia Widyahusada and Multistrada Arah 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 Multistrada Arah 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 Multistrada Arah Sarana, you can compare the effects of market volatilities on Prodia Widyahusada and Multistrada Arah 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 Multistrada Arah. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prodia Widyahusada and Multistrada Arah.
Diversification Opportunities for Prodia Widyahusada and Multistrada Arah
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Prodia and Multistrada is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Prodia Widyahusada Tbk and Multistrada Arah Sarana in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multistrada Arah Sarana 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 Multistrada Arah. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multistrada Arah Sarana has no effect on the direction of Prodia Widyahusada i.e., Prodia Widyahusada and Multistrada Arah go up and down completely randomly.
Pair Corralation between Prodia Widyahusada and Multistrada Arah
Assuming the 90 days trading horizon Prodia Widyahusada Tbk is expected to under-perform the Multistrada Arah. In addition to that, Prodia Widyahusada is 1.07 times more volatile than Multistrada Arah Sarana. It trades about -0.04 of its total potential returns per unit of risk. Multistrada Arah Sarana is currently generating about 0.11 per unit of volatility. If you would invest 479,000 in Multistrada Arah Sarana on September 1, 2024 and sell it today you would earn a total of 141,000 from holding Multistrada Arah Sarana or generate 29.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Prodia Widyahusada Tbk vs. Multistrada Arah Sarana
Performance |
| Timeline |
| Prodia Widyahusada Tbk |
| Multistrada Arah Sarana |
Prodia Widyahusada and Multistrada Arah Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prodia Widyahusada and Multistrada Arah
The main advantage of trading using opposite Prodia Widyahusada and Multistrada Arah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prodia Widyahusada position performs unexpectedly, Multistrada Arah 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 Multistrada Arah will offset losses from the drop in Multistrada Arah's 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 |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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