Correlation Between Indosterling Technomedia and Fast Food
Can any of the company-specific risk be diversified away by investing in both Indosterling Technomedia and Fast Food 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 Indosterling Technomedia and Fast Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Indosterling Technomedia Tbk and Fast Food Indonesia, you can compare the effects of market volatilities on Indosterling Technomedia and Fast Food 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 Indosterling Technomedia with a short position of Fast Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indosterling Technomedia and Fast Food.
Diversification Opportunities for Indosterling Technomedia and Fast Food
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Indosterling and Fast is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Indosterling Technomedia Tbk and Fast Food Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fast Food Indonesia and Indosterling Technomedia 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 Indosterling Technomedia Tbk are associated (or correlated) with Fast Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fast Food Indonesia has no effect on the direction of Indosterling Technomedia i.e., Indosterling Technomedia and Fast Food go up and down completely randomly.
Pair Corralation between Indosterling Technomedia and Fast Food
Assuming the 90 days trading horizon Indosterling Technomedia Tbk is expected to under-perform the Fast Food. In addition to that, Indosterling Technomedia is 1.15 times more volatile than Fast Food Indonesia. It trades about -0.33 of its total potential returns per unit of risk. Fast Food Indonesia is currently generating about -0.07 per unit of volatility. If you would invest 82,000 in Fast Food Indonesia on September 2, 2024 and sell it today you would lose (50,000) from holding Fast Food Indonesia or give up 60.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.58% |
| Values | Daily Returns |
Indosterling Technomedia Tbk vs. Fast Food Indonesia
Performance |
| Timeline |
| Indosterling Technomedia |
| Fast Food Indonesia |
Indosterling Technomedia and Fast Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indosterling Technomedia and Fast Food
The main advantage of trading using opposite Indosterling Technomedia and Fast Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indosterling Technomedia position performs unexpectedly, Fast Food 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 Fast Food will offset losses from the drop in Fast Food's long position.| Indosterling Technomedia vs. Multipolar Technology Tbk | Indosterling Technomedia vs. Digital Mediatama Maxima | Indosterling Technomedia vs. M Cash Integrasi | Indosterling Technomedia vs. NFC Indonesia PT |
| Fast Food vs. Hero Supermarket Tbk | Fast Food vs. Indoritel Makmur Internasional | Fast Food vs. Enseval Putra Megatrading | Fast Food vs. Fks Multi Agro |
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 Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |