Correlation Between TBS Energi and Mitrabahtera Segara
Can any of the company-specific risk be diversified away by investing in both TBS Energi and Mitrabahtera Segara 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 TBS Energi and Mitrabahtera Segara into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TBS Energi Utama and Mitrabahtera Segara Sejati, you can compare the effects of market volatilities on TBS Energi and Mitrabahtera Segara 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 TBS Energi with a short position of Mitrabahtera Segara. Check out your portfolio center. Please also check ongoing floating volatility patterns of TBS Energi and Mitrabahtera Segara.
Diversification Opportunities for TBS Energi and Mitrabahtera Segara
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between TBS and Mitrabahtera is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding TBS Energi Utama and Mitrabahtera Segara Sejati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitrabahtera Segara and TBS Energi 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 TBS Energi Utama are associated (or correlated) with Mitrabahtera Segara. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitrabahtera Segara has no effect on the direction of TBS Energi i.e., TBS Energi and Mitrabahtera Segara go up and down completely randomly.
Pair Corralation between TBS Energi and Mitrabahtera Segara
Assuming the 90 days trading horizon TBS Energi Utama is expected to generate 2.01 times more return on investment than Mitrabahtera Segara. However, TBS Energi is 2.01 times more volatile than Mitrabahtera Segara Sejati. It trades about 0.04 of its potential returns per unit of risk. Mitrabahtera Segara Sejati is currently generating about -0.03 per unit of risk. If you would invest 33,200 in TBS Energi Utama on September 3, 2024 and sell it today you would earn a total of 11,400 from holding TBS Energi Utama or generate 34.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TBS Energi Utama vs. Mitrabahtera Segara Sejati
Performance |
| Timeline |
| TBS Energi Utama |
| Mitrabahtera Segara |
TBS Energi and Mitrabahtera Segara Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TBS Energi and Mitrabahtera Segara
The main advantage of trading using opposite TBS Energi and Mitrabahtera Segara positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TBS Energi position performs unexpectedly, Mitrabahtera Segara 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 Mitrabahtera Segara will offset losses from the drop in Mitrabahtera Segara's long position.| TBS Energi vs. Weha Transportasi Indonesia | TBS Energi vs. Mitra Pinasthika Mustika | TBS Energi vs. Jakarta Int Hotels | TBS Energi vs. Asuransi Harta Aman |
| Mitrabahtera Segara vs. Petrosea Tbk | Mitrabahtera Segara vs. Samudera Indonesia Tbk | Mitrabahtera Segara vs. Soechi Lines Tbk | Mitrabahtera Segara vs. Wintermar Offshore Marine |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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