Correlation Between Pakuwon Jati and Mayora Indah
Can any of the company-specific risk be diversified away by investing in both Pakuwon Jati and Mayora Indah 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 Pakuwon Jati and Mayora Indah into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pakuwon Jati Tbk and Mayora Indah Tbk, you can compare the effects of market volatilities on Pakuwon Jati and Mayora Indah 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 Pakuwon Jati with a short position of Mayora Indah. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pakuwon Jati and Mayora Indah.
Diversification Opportunities for Pakuwon Jati and Mayora Indah
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pakuwon and Mayora is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Pakuwon Jati Tbk and Mayora Indah Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mayora Indah Tbk and Pakuwon Jati 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 Pakuwon Jati Tbk are associated (or correlated) with Mayora Indah. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mayora Indah Tbk has no effect on the direction of Pakuwon Jati i.e., Pakuwon Jati and Mayora Indah go up and down completely randomly.
Pair Corralation between Pakuwon Jati and Mayora Indah
Assuming the 90 days trading horizon Pakuwon Jati Tbk is expected to under-perform the Mayora Indah. In addition to that, Pakuwon Jati is 1.15 times more volatile than Mayora Indah Tbk. It trades about -0.21 of its total potential returns per unit of risk. Mayora Indah Tbk is currently generating about -0.04 per unit of volatility. If you would invest 284,000 in Mayora Indah Tbk on August 29, 2024 and sell it today you would lose (10,000) from holding Mayora Indah Tbk or give up 3.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pakuwon Jati Tbk vs. Mayora Indah Tbk
Performance |
| Timeline |
| Pakuwon Jati Tbk |
| Mayora Indah Tbk |
Pakuwon Jati and Mayora Indah Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pakuwon Jati and Mayora Indah
The main advantage of trading using opposite Pakuwon Jati and Mayora Indah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pakuwon Jati position performs unexpectedly, Mayora Indah 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 Mayora Indah will offset losses from the drop in Mayora Indah's long position.| Pakuwon Jati vs. Bumi Serpong Damai | Pakuwon Jati vs. Ciputra Development Tbk | Pakuwon Jati vs. Summarecon Agung Tbk | Pakuwon Jati vs. Pembangunan Perumahan PT |
| Mayora Indah vs. Indofood Cbp Sukses | Mayora Indah vs. Kalbe Farma Tbk | Mayora Indah vs. Unilever Indonesia Tbk | Mayora Indah vs. Ultra Jaya Milk |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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