Correlation Between Mitra Pinasthika and Central Omega
Can any of the company-specific risk be diversified away by investing in both Mitra Pinasthika and Central Omega 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 Mitra Pinasthika and Central Omega into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mitra Pinasthika Mustika and Central Omega Resources, you can compare the effects of market volatilities on Mitra Pinasthika and Central Omega 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 Mitra Pinasthika with a short position of Central Omega. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mitra Pinasthika and Central Omega.
Diversification Opportunities for Mitra Pinasthika and Central Omega
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Mitra and Central is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Mitra Pinasthika Mustika and Central Omega Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Central Omega Resources and Mitra Pinasthika 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 Mitra Pinasthika Mustika are associated (or correlated) with Central Omega. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Central Omega Resources has no effect on the direction of Mitra Pinasthika i.e., Mitra Pinasthika and Central Omega go up and down completely randomly.
Pair Corralation between Mitra Pinasthika and Central Omega
Assuming the 90 days trading horizon Mitra Pinasthika is expected to generate 34.63 times less return on investment than Central Omega. But when comparing it to its historical volatility, Mitra Pinasthika Mustika is 4.48 times less risky than Central Omega. It trades about 0.01 of its potential returns per unit of risk. Central Omega Resources is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 21,000 in Central Omega Resources on December 30, 2024 and sell it today you would earn a total of 5,000 from holding Central Omega Resources or generate 23.81% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Mitra Pinasthika Mustika vs. Central Omega Resources
Performance |
Timeline |
Mitra Pinasthika Mustika |
Central Omega Resources |
Mitra Pinasthika and Central Omega Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Mitra Pinasthika and Central Omega
The main advantage of trading using opposite Mitra Pinasthika and Central Omega positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mitra Pinasthika position performs unexpectedly, Central Omega 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 Central Omega will offset losses from the drop in Central Omega's long position.Mitra Pinasthika vs. Saratoga Investama Sedaya | Mitra Pinasthika vs. Puradelta Lestari PT | Mitra Pinasthika vs. Cikarang Listrindo Tbk | Mitra Pinasthika vs. Erajaya Swasembada Tbk |
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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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