Correlation Between Mark Dynamics and Jayamas Medica

Can any of the company-specific risk be diversified away by investing in both Mark Dynamics and Jayamas Medica 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 Mark Dynamics and Jayamas Medica into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Mark Dynamics Indonesia and Jayamas Medica Industri, you can compare the effects of market volatilities on Mark Dynamics and Jayamas Medica 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 Mark Dynamics with a short position of Jayamas Medica. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mark Dynamics and Jayamas Medica.

Diversification Opportunities for Mark Dynamics and Jayamas Medica

0.08

Correlation Coefficient

Mark Dynamics  Jayamas Medica

Significant diversification

The 3 months correlation between Mark and Jayamas is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Mark Dynamics Indonesia and Jayamas Medica Industri in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jayamas Medica Industri and Mark Dynamics 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 Mark Dynamics Indonesia are associated (or correlated) with Jayamas Medica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jayamas Medica Industri has no effect on the direction of Mark Dynamics i.e., Mark Dynamics and Jayamas Medica go up and down completely randomly.

Pair Corralation between Mark Dynamics and Jayamas Medica

Assuming the 90 days trading horizon Mark Dynamics Indonesia is expected to generate 1.0 times more return on investment than Jayamas Medica. However, Mark Dynamics Indonesia is 1.0 times less risky than Jayamas Medica. It trades about 0.02 of its potential returns per unit of risk. Jayamas Medica Industri is currently generating about -0.07 per unit of risk. If you would invest  106,500  in Mark Dynamics Indonesia on October 9, 2024 and sell it today you would earn a total of  500.00  from holding Mark Dynamics Indonesia or generate 0.47% return on investment over 90 days.

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

Mark Dynamics Indonesia  vs.  Jayamas Medica Industri

Mark Dynamics Indonesia

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Mark Dynamics Indonesia are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, Mark Dynamics is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Jayamas Medica Industri

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Jayamas Medica Industri are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Jayamas Medica may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Mark Dynamics and Jayamas Medica

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

The idea behind Mark Dynamics Indonesia and Jayamas Medica Industri 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.