Correlation Between Weha Transportasi and Modern Internasional
Can any of the company-specific risk be diversified away by investing in both Weha Transportasi and Modern Internasional 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 Weha Transportasi and Modern Internasional into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Weha Transportasi Indonesia and Modern Internasional Tbk, you can compare the effects of market volatilities on Weha Transportasi and Modern Internasional 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 Weha Transportasi with a short position of Modern Internasional. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weha Transportasi and Modern Internasional.
Diversification Opportunities for Weha Transportasi and Modern Internasional
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Weha and Modern is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Weha Transportasi Indonesia and Modern Internasional Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Modern Internasional Tbk and Weha Transportasi 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 Weha Transportasi Indonesia are associated (or correlated) with Modern Internasional. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Modern Internasional Tbk has no effect on the direction of Weha Transportasi i.e., Weha Transportasi and Modern Internasional go up and down completely randomly.
Pair Corralation between Weha Transportasi and Modern Internasional
Assuming the 90 days trading horizon Weha Transportasi Indonesia is expected to under-perform the Modern Internasional. But the stock apears to be less risky and, when comparing its historical volatility, Weha Transportasi Indonesia is 4.86 times less risky than Modern Internasional. The stock trades about -0.01 of its potential returns per unit of risk. The Modern Internasional Tbk is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 800.00 in Modern Internasional Tbk on November 5, 2024 and sell it today you would earn a total of 0.00 from holding Modern Internasional Tbk or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Weha Transportasi Indonesia vs. Modern Internasional Tbk
Performance |
| Timeline |
| Weha Transportasi |
| Modern Internasional Tbk |
Weha Transportasi and Modern Internasional Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weha Transportasi and Modern Internasional
The main advantage of trading using opposite Weha Transportasi and Modern Internasional positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weha Transportasi position performs unexpectedly, Modern Internasional 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 Modern Internasional will offset losses from the drop in Modern Internasional's long position.| Weha Transportasi vs. PT Temas Tbk | Weha Transportasi vs. Dosni Roha Indonesia | Weha Transportasi vs. Rig Tenders Tbk | Weha Transportasi vs. Samudera Indonesia Tbk |
| Modern Internasional vs. Merdeka Copper Gold | Modern Internasional vs. Tower Bersama Infrastructure | Modern Internasional vs. Erajaya Swasembada Tbk | Modern Internasional vs. Surya Citra Media |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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