Correlation Between Mitrabahtera Segara and Rig Tenders

Can any of the company-specific risk be diversified away by investing in both Mitrabahtera Segara and Rig Tenders 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 Mitrabahtera Segara and Rig Tenders into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Mitrabahtera Segara Sejati and Rig Tenders Tbk, you can compare the effects of market volatilities on Mitrabahtera Segara and Rig Tenders 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 Mitrabahtera Segara with a short position of Rig Tenders. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mitrabahtera Segara and Rig Tenders.

Diversification Opportunities for Mitrabahtera Segara and Rig Tenders

-0.13

Correlation Coefficient

Mitrabahtera Segara  Rig Tenders

Good diversification

The 3 months correlation between Mitrabahtera and Rig is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Mitrabahtera Segara Sejati and Rig Tenders Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rig Tenders Tbk and Mitrabahtera Segara 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 Mitrabahtera Segara Sejati are associated (or correlated) with Rig Tenders. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rig Tenders Tbk has no effect on the direction of Mitrabahtera Segara i.e., Mitrabahtera Segara and Rig Tenders go up and down completely randomly.

Pair Corralation between Mitrabahtera Segara and Rig Tenders

Assuming the 90 days trading horizon Mitrabahtera Segara is expected to generate 1.45 times less return on investment than Rig Tenders. In addition to that, Mitrabahtera Segara is 1.13 times more volatile than Rig Tenders Tbk. It trades about 0.0 of its total potential returns per unit of risk. Rig Tenders Tbk is currently generating about 0.01 per unit of volatility. If you would invest  60,500  in Rig Tenders Tbk on August 31, 2024 and sell it today you would lose (500.00) from holding Rig Tenders Tbk or give up 0.83% of portfolio value over 90 days.

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

Mitrabahtera Segara Sejati  vs.  Rig Tenders Tbk

Mitrabahtera Segara

Risk-Adjusted Performance

0 of 100

Weak

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

Rig Tenders Tbk

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Rig Tenders Tbk has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Rig Tenders 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 Mitrabahtera Segara and Rig Tenders

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

The idea behind Mitrabahtera Segara Sejati and Rig Tenders 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.