Correlation Between Rig Tenders and Fortune Mate
Can any of the company-specific risk be diversified away by investing in both Rig Tenders and Fortune Mate 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 Rig Tenders and Fortune Mate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rig Tenders Tbk and Fortune Mate Indonesia, you can compare the effects of market volatilities on Rig Tenders and Fortune Mate 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 Rig Tenders with a short position of Fortune Mate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rig Tenders and Fortune Mate.
Diversification Opportunities for Rig Tenders and Fortune Mate
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Rig and Fortune is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Rig Tenders Tbk and Fortune Mate Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortune Mate Indonesia and Rig Tenders 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 Rig Tenders Tbk are associated (or correlated) with Fortune Mate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortune Mate Indonesia has no effect on the direction of Rig Tenders i.e., Rig Tenders and Fortune Mate go up and down completely randomly.
Pair Corralation between Rig Tenders and Fortune Mate
Assuming the 90 days trading horizon Rig Tenders is expected to generate 6.92 times less return on investment than Fortune Mate. But when comparing it to its historical volatility, Rig Tenders Tbk is 2.98 times less risky than Fortune Mate. It trades about 0.07 of its potential returns per unit of risk. Fortune Mate Indonesia is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 15,600 in Fortune Mate Indonesia on September 2, 2024 and sell it today you would earn a total of 38,900 from holding Fortune Mate Indonesia or generate 249.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Rig Tenders Tbk vs. Fortune Mate Indonesia
Performance |
| Timeline |
| Rig Tenders Tbk |
| Fortune Mate Indonesia |
Rig Tenders and Fortune Mate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rig Tenders and Fortune Mate
The main advantage of trading using opposite Rig Tenders and Fortune Mate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rig Tenders position performs unexpectedly, Fortune Mate 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 Fortune Mate will offset losses from the drop in Fortune Mate's long position.| Rig Tenders vs. Matahari Department Store | Rig Tenders vs. Multi Medika Internasional | Rig Tenders vs. Visi Media Asia | Rig Tenders vs. Bayan Resources Tbk |
| Fortune Mate vs. Lippo Cikarang Tbk | Fortune Mate vs. Bekasi Asri Pemula | Fortune Mate vs. Mitra Pinasthika Mustika | Fortune Mate vs. Jakarta Int Hotels |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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