Correlation Between Chandra Asri and Metrodata Electronics
Can any of the company-specific risk be diversified away by investing in both Chandra Asri and Metrodata Electronics 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 Chandra Asri and Metrodata Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chandra Asri Petrochemical and Metrodata Electronics Tbk, you can compare the effects of market volatilities on Chandra Asri and Metrodata Electronics 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 Chandra Asri with a short position of Metrodata Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chandra Asri and Metrodata Electronics.
Diversification Opportunities for Chandra Asri and Metrodata Electronics
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Chandra and Metrodata is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Chandra Asri Petrochemical and Metrodata Electronics Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metrodata Electronics Tbk and Chandra Asri 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 Chandra Asri Petrochemical are associated (or correlated) with Metrodata Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metrodata Electronics Tbk has no effect on the direction of Chandra Asri i.e., Chandra Asri and Metrodata Electronics go up and down completely randomly.
Pair Corralation between Chandra Asri and Metrodata Electronics
Assuming the 90 days trading horizon Chandra Asri Petrochemical is expected to generate 2.01 times more return on investment than Metrodata Electronics. However, Chandra Asri is 2.01 times more volatile than Metrodata Electronics Tbk. It trades about 0.08 of its potential returns per unit of risk. Metrodata Electronics Tbk is currently generating about 0.03 per unit of risk. If you would invest 233,284 in Chandra Asri Petrochemical on August 27, 2024 and sell it today you would earn a total of 409,216 from holding Chandra Asri Petrochemical or generate 175.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Chandra Asri Petrochemical vs. Metrodata Electronics Tbk
Performance |
| Timeline |
| Chandra Asri Petroch |
| Metrodata Electronics Tbk |
Chandra Asri and Metrodata Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chandra Asri and Metrodata Electronics
The main advantage of trading using opposite Chandra Asri and Metrodata Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chandra Asri position performs unexpectedly, Metrodata Electronics 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 Metrodata Electronics will offset losses from the drop in Metrodata Electronics' long position.| Chandra Asri vs. Barito Pacific Tbk | Chandra Asri vs. Pabrik Kertas Tjiwi | Chandra Asri vs. Charoen Pokphand Indonesia | Chandra Asri vs. Indah Kiat Pulp |
| Metrodata Electronics vs. Multipolar Tbk | Metrodata Electronics vs. Astra Graphia Tbk | Metrodata Electronics vs. Matahari Putra Prima | Metrodata Electronics vs. Ramayana Lestari Sentosa |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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