Correlation Between Sinergi Inti and Menthobi Karyatama

Can any of the company-specific risk be diversified away by investing in both Sinergi Inti and Menthobi Karyatama 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 Sinergi Inti and Menthobi Karyatama into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Sinergi Inti Plastindo and Menthobi Karyatama Raya, you can compare the effects of market volatilities on Sinergi Inti and Menthobi Karyatama 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 Sinergi Inti with a short position of Menthobi Karyatama. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sinergi Inti and Menthobi Karyatama.

Diversification Opportunities for Sinergi Inti and Menthobi Karyatama

0.57

Correlation Coefficient

Sinergi Inti  Menthobi Karyatama

Very weak diversification

The 3 months correlation between Sinergi and Menthobi is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Sinergi Inti Plastindo and Menthobi Karyatama Raya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Menthobi Karyatama Raya and Sinergi Inti 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 Sinergi Inti Plastindo are associated (or correlated) with Menthobi Karyatama. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Menthobi Karyatama Raya has no effect on the direction of Sinergi Inti i.e., Sinergi Inti and Menthobi Karyatama go up and down completely randomly.

Pair Corralation between Sinergi Inti and Menthobi Karyatama

Assuming the 90 days trading horizon Sinergi Inti Plastindo is expected to generate 6.25 times more return on investment than Menthobi Karyatama. However, Sinergi Inti is 6.25 times more volatile than Menthobi Karyatama Raya. It trades about 0.07 of its potential returns per unit of risk. Menthobi Karyatama Raya is currently generating about -0.18 per unit of risk. If you would invest  2,300  in Sinergi Inti Plastindo on October 9, 2024 and sell it today you would earn a total of  100.00  from holding Sinergi Inti Plastindo or generate 4.35% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	94.44%
Values	Daily Returns

Sinergi Inti Plastindo  vs.  Menthobi Karyatama Raya

Sinergi Inti Plastindo

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sinergi Inti Plastindo has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's forward-looking signals remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Menthobi Karyatama Raya

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Sinergi Inti and Menthobi Karyatama

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

The idea behind Sinergi Inti Plastindo and Menthobi Karyatama Raya 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.