Correlation Between Merdeka Copper and Hero Supermarket
Can any of the company-specific risk be diversified away by investing in both Merdeka Copper and Hero Supermarket 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 Merdeka Copper and Hero Supermarket into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Merdeka Copper Gold and Hero Supermarket Tbk, you can compare the effects of market volatilities on Merdeka Copper and Hero Supermarket 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 Merdeka Copper with a short position of Hero Supermarket. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merdeka Copper and Hero Supermarket.
Diversification Opportunities for Merdeka Copper and Hero Supermarket
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Merdeka and Hero is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Merdeka Copper Gold and Hero Supermarket Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hero Supermarket Tbk and Merdeka Copper 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 Merdeka Copper Gold are associated (or correlated) with Hero Supermarket. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hero Supermarket Tbk has no effect on the direction of Merdeka Copper i.e., Merdeka Copper and Hero Supermarket go up and down completely randomly.
Pair Corralation between Merdeka Copper and Hero Supermarket
Assuming the 90 days trading horizon Merdeka Copper Gold is expected to generate 1.71 times more return on investment than Hero Supermarket. However, Merdeka Copper is 1.71 times more volatile than Hero Supermarket Tbk. It trades about -0.02 of its potential returns per unit of risk. Hero Supermarket Tbk is currently generating about -0.15 per unit of risk. If you would invest 161,500 in Merdeka Copper Gold on December 30, 2024 and sell it today you would lose (18,500) from holding Merdeka Copper Gold or give up 11.46% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Merdeka Copper Gold vs. Hero Supermarket Tbk
Performance |
Timeline |
Merdeka Copper Gold |
Hero Supermarket Tbk |
Merdeka Copper and Hero Supermarket Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Merdeka Copper and Hero Supermarket
The main advantage of trading using opposite Merdeka Copper and Hero Supermarket positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merdeka Copper position performs unexpectedly, Hero Supermarket 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 Hero Supermarket will offset losses from the drop in Hero Supermarket's long position.Merdeka Copper vs. PT Sarana Menara | Merdeka Copper vs. Tower Bersama Infrastructure | Merdeka Copper vs. Pabrik Kertas Tjiwi | Merdeka Copper vs. Mitra Keluarga Karyasehat |
Hero Supermarket vs. Fast Food Indonesia | Hero Supermarket vs. Enseval Putra Megatrading | Hero Supermarket vs. Matahari Putra Prima | Hero Supermarket vs. Hexindo Adiperkasa Tbk |
Check out your portfolio center.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.
Other Complementary Tools
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |