Correlation Between Micron Technology and Asuransi Kresna

Can any of the company-specific risk be diversified away by investing in both Micron Technology and Asuransi Kresna 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 Micron Technology and Asuransi Kresna into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Micron Technology and Asuransi Kresna Mitra, you can compare the effects of market volatilities on Micron Technology and Asuransi Kresna 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 Micron Technology with a short position of Asuransi Kresna. Check out your portfolio center. Please also check ongoing floating volatility patterns of Micron Technology and Asuransi Kresna.

Diversification Opportunities for Micron Technology and Asuransi Kresna

0.4

Correlation Coefficient

Micron Technology  Asuransi Kresna

Very weak diversification

The 3 months correlation between Micron and Asuransi is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Micron Technology and Asuransi Kresna Mitra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asuransi Kresna Mitra and Micron Technology 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 Micron Technology are associated (or correlated) with Asuransi Kresna. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asuransi Kresna Mitra has no effect on the direction of Micron Technology i.e., Micron Technology and Asuransi Kresna go up and down completely randomly.

Pair Corralation between Micron Technology and Asuransi Kresna

Allowing for the 90-day total investment horizon Micron Technology is expected to under-perform the Asuransi Kresna. But the stock apears to be less risky and, when comparing its historical volatility, Micron Technology is 1.98 times less risky than Asuransi Kresna. The stock trades about -0.07 of its potential returns per unit of risk. The Asuransi Kresna Mitra is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  700.00  in Asuransi Kresna Mitra on September 29, 2024 and sell it today you would earn a total of  400.00  from holding Asuransi Kresna Mitra or generate 57.14% return on investment over 90 days.

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

Micron Technology  vs.  Asuransi Kresna Mitra

Micron Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Micron Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Asuransi Kresna Mitra

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Asuransi Kresna Mitra are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Asuransi Kresna disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Micron Technology and Asuransi Kresna

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

The idea behind Micron Technology and Asuransi Kresna Mitra 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.