Correlation Between Wahana Ottomitra and Bank Mega
Can any of the company-specific risk be diversified away by investing in both Wahana Ottomitra and Bank Mega 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 Wahana Ottomitra and Bank Mega into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wahana Ottomitra Multiartha and Bank Mega Tbk, you can compare the effects of market volatilities on Wahana Ottomitra and Bank Mega 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 Wahana Ottomitra with a short position of Bank Mega. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wahana Ottomitra and Bank Mega.
Diversification Opportunities for Wahana Ottomitra and Bank Mega
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Wahana and Bank is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Wahana Ottomitra Multiartha and Bank Mega Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Mega Tbk and Wahana Ottomitra 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 Wahana Ottomitra Multiartha are associated (or correlated) with Bank Mega. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Mega Tbk has no effect on the direction of Wahana Ottomitra i.e., Wahana Ottomitra and Bank Mega go up and down completely randomly.
Pair Corralation between Wahana Ottomitra and Bank Mega
Assuming the 90 days trading horizon Wahana Ottomitra Multiartha is expected to under-perform the Bank Mega. In addition to that, Wahana Ottomitra is 1.42 times more volatile than Bank Mega Tbk. It trades about -0.12 of its total potential returns per unit of risk. Bank Mega Tbk is currently generating about -0.13 per unit of volatility. If you would invest 499,000 in Bank Mega Tbk on August 28, 2024 and sell it today you would lose (12,000) from holding Bank Mega Tbk or give up 2.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wahana Ottomitra Multiartha vs. Bank Mega Tbk
Performance |
| Timeline |
| Wahana Ottomitra Mul |
| Bank Mega Tbk |
Wahana Ottomitra and Bank Mega Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wahana Ottomitra and Bank Mega
The main advantage of trading using opposite Wahana Ottomitra and Bank Mega positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wahana Ottomitra position performs unexpectedly, Bank Mega 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 Bank Mega will offset losses from the drop in Bank Mega's long position.| Wahana Ottomitra vs. Trimegah Securities Tbk | Wahana Ottomitra vs. Clipan Finance Indonesia | Wahana Ottomitra vs. Adira Dinamika Multi | Wahana Ottomitra vs. Paninvest Tbk |
| Bank Mega vs. Bank Ocbc Nisp | Bank Mega vs. Bank Mayapada Internasional | Bank Mega vs. Bank Permata Tbk | Bank Mega vs. Bank Pan Indonesia |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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