Correlation Between Dharma Satya and Mahkota Group

Can any of the company-specific risk be diversified away by investing in both Dharma Satya and Mahkota Group 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 Dharma Satya and Mahkota Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Dharma Satya Nusantara and Mahkota Group Tbk, you can compare the effects of market volatilities on Dharma Satya and Mahkota Group 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 Dharma Satya with a short position of Mahkota Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dharma Satya and Mahkota Group.

Diversification Opportunities for Dharma Satya and Mahkota Group

0.0

Correlation Coefficient

Dharma Satya  Mahkota Group

Pay attention - limited upside

The 3 months correlation between Dharma and Mahkota is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Dharma Satya Nusantara and Mahkota Group Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mahkota Group Tbk and Dharma Satya 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 Dharma Satya Nusantara are associated (or correlated) with Mahkota Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mahkota Group Tbk has no effect on the direction of Dharma Satya i.e., Dharma Satya and Mahkota Group go up and down completely randomly.

Pair Corralation between Dharma Satya and Mahkota Group

If you would invest (100.00) in Mahkota Group Tbk on October 21, 2024 and sell it today you would earn a total of  100.00  from holding Mahkota Group Tbk or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Dharma Satya Nusantara  vs.  Mahkota Group Tbk

Dharma Satya Nusantara

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Dharma Satya Nusantara has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Dharma Satya is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Mahkota Group Tbk

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mahkota Group Tbk has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Mahkota Group is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Dharma Satya and Mahkota Group

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

The idea behind Dharma Satya Nusantara and Mahkota Group Tbk 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.

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