Correlation Between PT MNC and Multistrada Arah

Can any of the company-specific risk be diversified away by investing in both PT MNC and Multistrada Arah 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 PT MNC and Multistrada Arah into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PT MNC Energy and Multistrada Arah Sarana, you can compare the effects of market volatilities on PT MNC and Multistrada Arah 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 PT MNC with a short position of Multistrada Arah. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT MNC and Multistrada Arah.

Diversification Opportunities for PT MNC and Multistrada Arah

0.0

Correlation Coefficient

PT MNC  Multistrada Arah

Pay attention - limited upside

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

Pair Corralation between PT MNC and Multistrada Arah

If you would invest  4,700  in PT MNC Energy on December 1, 2024 and sell it today you would earn a total of  400.00  from holding PT MNC Energy or generate 8.51% return on investment over 90 days.

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

PT MNC Energy  vs.  Multistrada Arah Sarana

PT MNC Energy

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in PT MNC Energy are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, PT MNC may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Multistrada Arah Sarana

Risk-Adjusted Performance

Very Weak

Over the last 90 days Multistrada Arah Sarana has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Multistrada Arah 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 PT MNC and Multistrada Arah

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

The idea behind PT MNC Energy and Multistrada Arah Sarana 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.