Correlation Between Solusi Sinergi and Multipolar Technology
Can any of the company-specific risk be diversified away by investing in both Solusi Sinergi and Multipolar Technology 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 Solusi Sinergi and Multipolar Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Solusi Sinergi Digital and Multipolar Technology Tbk, you can compare the effects of market volatilities on Solusi Sinergi and Multipolar Technology 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 Solusi Sinergi with a short position of Multipolar Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Solusi Sinergi and Multipolar Technology.
Diversification Opportunities for Solusi Sinergi and Multipolar Technology
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Solusi and Multipolar is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Solusi Sinergi Digital and Multipolar Technology Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multipolar Technology Tbk and Solusi Sinergi 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 Solusi Sinergi Digital are associated (or correlated) with Multipolar Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multipolar Technology Tbk has no effect on the direction of Solusi Sinergi i.e., Solusi Sinergi and Multipolar Technology go up and down completely randomly.
Pair Corralation between Solusi Sinergi and Multipolar Technology
Assuming the 90 days trading horizon Solusi Sinergi is expected to generate 2.69 times less return on investment than Multipolar Technology. But when comparing it to its historical volatility, Solusi Sinergi Digital is 3.07 times less risky than Multipolar Technology. It trades about 0.16 of its potential returns per unit of risk. Multipolar Technology Tbk is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,780,000 in Multipolar Technology Tbk on September 5, 2024 and sell it today you would earn a total of 420,000 from holding Multipolar Technology Tbk or generate 23.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Solusi Sinergi Digital vs. Multipolar Technology Tbk
Performance |
| Timeline |
| Solusi Sinergi Digital |
| Multipolar Technology Tbk |
Solusi Sinergi and Multipolar Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Solusi Sinergi and Multipolar Technology
The main advantage of trading using opposite Solusi Sinergi and Multipolar Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Solusi Sinergi position performs unexpectedly, Multipolar Technology 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 Multipolar Technology will offset losses from the drop in Multipolar Technology's long position.| Solusi Sinergi vs. Multipolar Technology Tbk | Solusi Sinergi vs. Indosterling Technomedia Tbk | Solusi Sinergi vs. Envy Technologies Indonesia |
| Multipolar Technology vs. Astra Graphia Tbk | Multipolar Technology vs. Mitra Pinasthika Mustika | Multipolar Technology vs. Jakarta Int Hotels | Multipolar Technology vs. Asuransi Harta Aman |
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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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