Correlation Between Mahaka Media and Eastparc Hotel
Can any of the company-specific risk be diversified away by investing in both Mahaka Media and Eastparc Hotel 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 Mahaka Media and Eastparc Hotel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mahaka Media Tbk and Eastparc Hotel Tbk, you can compare the effects of market volatilities on Mahaka Media and Eastparc Hotel 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 Mahaka Media with a short position of Eastparc Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mahaka Media and Eastparc Hotel.
Diversification Opportunities for Mahaka Media and Eastparc Hotel
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Mahaka and Eastparc is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Mahaka Media Tbk and Eastparc Hotel Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastparc Hotel Tbk and Mahaka Media 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 Mahaka Media Tbk are associated (or correlated) with Eastparc Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastparc Hotel Tbk has no effect on the direction of Mahaka Media i.e., Mahaka Media and Eastparc Hotel go up and down completely randomly.
Pair Corralation between Mahaka Media and Eastparc Hotel
Assuming the 90 days trading horizon Mahaka Media Tbk is expected to under-perform the Eastparc Hotel. In addition to that, Mahaka Media is 1.72 times more volatile than Eastparc Hotel Tbk. It trades about -0.09 of its total potential returns per unit of risk. Eastparc Hotel Tbk is currently generating about 0.04 per unit of volatility. If you would invest 8,969 in Eastparc Hotel Tbk on September 14, 2024 and sell it today you would earn a total of 2,531 from holding Eastparc Hotel Tbk or generate 28.22% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 99.79% |
Values | Daily Returns |
Mahaka Media Tbk vs. Eastparc Hotel Tbk
Performance |
Timeline |
Mahaka Media Tbk |
Eastparc Hotel Tbk |
Mahaka Media and Eastparc Hotel Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Mahaka Media and Eastparc Hotel
The main advantage of trading using opposite Mahaka Media and Eastparc Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mahaka Media position performs unexpectedly, Eastparc Hotel 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 Eastparc Hotel will offset losses from the drop in Eastparc Hotel's long position.Mahaka Media vs. Mnc Land Tbk | Mahaka Media vs. MNC Vision Networks | Mahaka Media vs. MD Pictures Tbk | Mahaka Media vs. Link Net Tbk |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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