Correlation Between Jayamas Medica and Menthobi Karyatama
Can any of the company-specific risk be diversified away by investing in both Jayamas Medica and Menthobi Karyatama 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 Jayamas Medica and Menthobi Karyatama into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jayamas Medica Industri and Menthobi Karyatama Raya, you can compare the effects of market volatilities on Jayamas Medica and Menthobi Karyatama 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 Jayamas Medica with a short position of Menthobi Karyatama. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jayamas Medica and Menthobi Karyatama.
Diversification Opportunities for Jayamas Medica and Menthobi Karyatama
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jayamas and Menthobi is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Jayamas Medica Industri and Menthobi Karyatama Raya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Menthobi Karyatama Raya and Jayamas Medica 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 Jayamas Medica Industri are associated (or correlated) with Menthobi Karyatama. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Menthobi Karyatama Raya has no effect on the direction of Jayamas Medica i.e., Jayamas Medica and Menthobi Karyatama go up and down completely randomly.
Pair Corralation between Jayamas Medica and Menthobi Karyatama
Assuming the 90 days trading horizon Jayamas Medica Industri is expected to generate 1.63 times more return on investment than Menthobi Karyatama. However, Jayamas Medica is 1.63 times more volatile than Menthobi Karyatama Raya. It trades about 0.08 of its potential returns per unit of risk. Menthobi Karyatama Raya is currently generating about 0.13 per unit of risk. If you would invest 18,000 in Jayamas Medica Industri on October 22, 2024 and sell it today you would earn a total of 300.00 from holding Jayamas Medica Industri or generate 1.67% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Jayamas Medica Industri vs. Menthobi Karyatama Raya
Performance |
Timeline |
Jayamas Medica Industri |
Menthobi Karyatama Raya |
Jayamas Medica and Menthobi Karyatama Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Jayamas Medica and Menthobi Karyatama
The main advantage of trading using opposite Jayamas Medica and Menthobi Karyatama positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jayamas Medica position performs unexpectedly, Menthobi Karyatama 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 Menthobi Karyatama will offset losses from the drop in Menthobi Karyatama's long position.Jayamas Medica vs. Mark Dynamics Indonesia | Jayamas Medica vs. PT Hetzer Medical | Jayamas Medica vs. GoTo Gojek Tokopedia | Jayamas Medica vs. Leyand International 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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