Correlation Between Nusantara Voucher and M Cash

Can any of the company-specific risk be diversified away by investing in both Nusantara Voucher and M Cash 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 Nusantara Voucher and M Cash into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Nusantara Voucher Distribution and M Cash Integrasi, you can compare the effects of market volatilities on Nusantara Voucher and M Cash 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 Nusantara Voucher with a short position of M Cash. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nusantara Voucher and M Cash.

Diversification Opportunities for Nusantara Voucher and M Cash

-0.1

Correlation Coefficient

Nusantara Voucher  M Cash

Good diversification

The 3 months correlation between Nusantara and MCAS is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Nusantara Voucher Distribution and M Cash Integrasi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on M Cash Integrasi and Nusantara Voucher 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 Nusantara Voucher Distribution are associated (or correlated) with M Cash. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of M Cash Integrasi has no effect on the direction of Nusantara Voucher i.e., Nusantara Voucher and M Cash go up and down completely randomly.

Pair Corralation between Nusantara Voucher and M Cash

Assuming the 90 days trading horizon Nusantara Voucher Distribution is expected to generate 3.76 times more return on investment than M Cash. However, Nusantara Voucher is 3.76 times more volatile than M Cash Integrasi. It trades about 0.19 of its potential returns per unit of risk. M Cash Integrasi is currently generating about -0.07 per unit of risk. If you would invest  12,300  in Nusantara Voucher Distribution on September 1, 2024 and sell it today you would earn a total of  4,800  from holding Nusantara Voucher Distribution or generate 39.02% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Nusantara Voucher Distribution  vs.  M Cash Integrasi

Nusantara Voucher

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Nusantara Voucher Distribution are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Nusantara Voucher disclosed solid returns over the last few months and may actually be approaching a breakup point.

M Cash Integrasi

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in M Cash Integrasi are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, M Cash may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Pair Trading with Nusantara Voucher and M Cash

The main advantage of trading using opposite Nusantara Voucher and M Cash positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nusantara Voucher position performs unexpectedly, M Cash 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 M Cash will offset losses from the drop in M Cash's long position.

The idea behind Nusantara Voucher Distribution and M Cash Integrasi pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.