Correlation Between Medikaloka Hermina and MD Pictures

Can any of the company-specific risk be diversified away by investing in both Medikaloka Hermina and MD Pictures 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 Medikaloka Hermina and MD Pictures into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Medikaloka Hermina PT and MD Pictures Tbk, you can compare the effects of market volatilities on Medikaloka Hermina and MD Pictures 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 Medikaloka Hermina with a short position of MD Pictures. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medikaloka Hermina and MD Pictures.

Diversification Opportunities for Medikaloka Hermina and MD Pictures

-0.09

Correlation Coefficient

Medikaloka Hermina  MD Pictures

Good diversification

The 3 months correlation between Medikaloka and FILM is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Medikaloka Hermina PT and MD Pictures Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MD Pictures Tbk and Medikaloka Hermina 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 Medikaloka Hermina PT are associated (or correlated) with MD Pictures. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MD Pictures Tbk has no effect on the direction of Medikaloka Hermina i.e., Medikaloka Hermina and MD Pictures go up and down completely randomly.

Pair Corralation between Medikaloka Hermina and MD Pictures

Assuming the 90 days trading horizon Medikaloka Hermina PT is expected to under-perform the MD Pictures. But the stock apears to be less risky and, when comparing its historical volatility, Medikaloka Hermina PT is 1.29 times less risky than MD Pictures. The stock trades about -0.06 of its potential returns per unit of risk. The MD Pictures Tbk is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  358,000  in MD Pictures Tbk on December 4, 2024 and sell it today you would earn a total of  1,000.00  from holding MD Pictures Tbk or generate 0.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.28%
Values	Daily Returns

Medikaloka Hermina PT  vs.  MD Pictures Tbk

Medikaloka Hermina

Risk-Adjusted Performance

Very Weak

Over the last 90 days Medikaloka Hermina PT 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.

MD Pictures Tbk

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in MD Pictures Tbk are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, MD Pictures 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 Medikaloka Hermina and MD Pictures

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

The idea behind Medikaloka Hermina PT and MD Pictures 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.

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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.