Correlation Between Wijaya Karya and Mitrabahtera Segara
Can any of the company-specific risk be diversified away by investing in both Wijaya Karya 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 Wijaya Karya and Mitrabahtera Segara into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wijaya Karya Beton and Mitrabahtera Segara Sejati, you can compare the effects of market volatilities on Wijaya Karya 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 Wijaya Karya with a short position of Mitrabahtera Segara. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wijaya Karya and Mitrabahtera Segara.
Diversification Opportunities for Wijaya Karya and Mitrabahtera Segara
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Wijaya and Mitrabahtera is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Wijaya Karya Beton and Mitrabahtera Segara Sejati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitrabahtera Segara and Wijaya Karya 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 Wijaya Karya Beton 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 Wijaya Karya i.e., Wijaya Karya and Mitrabahtera Segara go up and down completely randomly.
Pair Corralation between Wijaya Karya and Mitrabahtera Segara
Assuming the 90 days trading horizon Wijaya Karya Beton is expected to generate 1.78 times more return on investment than Mitrabahtera Segara. However, Wijaya Karya is 1.78 times more volatile than Mitrabahtera Segara Sejati. It trades about 0.1 of its potential returns per unit of risk. Mitrabahtera Segara Sejati is currently generating about -0.02 per unit of risk. If you would invest 7,400 in Wijaya Karya Beton on October 20, 2024 and sell it today you would earn a total of 400.00 from holding Wijaya Karya Beton or generate 5.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wijaya Karya Beton vs. Mitrabahtera Segara Sejati
Performance |
| Timeline |
| Wijaya Karya Beton |
| Mitrabahtera Segara |
Wijaya Karya and Mitrabahtera Segara Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wijaya Karya and Mitrabahtera Segara
The main advantage of trading using opposite Wijaya Karya and Mitrabahtera Segara positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wijaya Karya 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.| Wijaya Karya vs. Trias Sentosa Tbk | Wijaya Karya vs. Slj Global Tbk | Wijaya Karya vs. Indo Acidatama Tbk | Wijaya Karya vs. PT Mulia Industrindo |
| Mitrabahtera Segara vs. Adhi Karya Persero | Mitrabahtera Segara vs. Waskita Karya Persero | Mitrabahtera Segara vs. Pembangunan Perumahan PT | Mitrabahtera Segara vs. Jasa Marga Tbk |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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