Correlation Between Pan Brothers and Mitra Pinasthika
Can any of the company-specific risk be diversified away by investing in both Pan Brothers and Mitra Pinasthika 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 Pan Brothers and Mitra Pinasthika into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pan Brothers Tbk and Mitra Pinasthika Mustika, you can compare the effects of market volatilities on Pan Brothers and Mitra Pinasthika 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 Pan Brothers with a short position of Mitra Pinasthika. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pan Brothers and Mitra Pinasthika.
Diversification Opportunities for Pan Brothers and Mitra Pinasthika
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pan and Mitra is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Pan Brothers Tbk and Mitra Pinasthika Mustika in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitra Pinasthika Mustika and Pan Brothers 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 Pan Brothers Tbk are associated (or correlated) with Mitra Pinasthika. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitra Pinasthika Mustika has no effect on the direction of Pan Brothers i.e., Pan Brothers and Mitra Pinasthika go up and down completely randomly.
Pair Corralation between Pan Brothers and Mitra Pinasthika
Assuming the 90 days trading horizon Pan Brothers Tbk is expected to under-perform the Mitra Pinasthika. In addition to that, Pan Brothers is 2.32 times more volatile than Mitra Pinasthika Mustika. It trades about -0.16 of its total potential returns per unit of risk. Mitra Pinasthika Mustika is currently generating about 0.04 per unit of volatility. If you would invest 97,000 in Mitra Pinasthika Mustika on February 28, 2024 and sell it today you would earn a total of 8,000 from holding Mitra Pinasthika Mustika or generate 8.25% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 99.14% |
Values | Daily Returns |
Pan Brothers Tbk vs. Mitra Pinasthika Mustika
Performance |
Timeline |
Pan Brothers Tbk |
Mitra Pinasthika Mustika |
Pan Brothers and Mitra Pinasthika Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Pan Brothers and Mitra Pinasthika
The main advantage of trading using opposite Pan Brothers and Mitra Pinasthika positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pan Brothers position performs unexpectedly, Mitra Pinasthika 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 Mitra Pinasthika will offset losses from the drop in Mitra Pinasthika's long position.Pan Brothers vs. Telkom Indonesia Tbk | Pan Brothers vs. Bank Mandiri Persero | Pan Brothers vs. Bank Central Asia | Pan Brothers vs. Indofood Sukses Makmur |
Mitra Pinasthika vs. Telkom Indonesia Tbk | Mitra Pinasthika vs. Bank Mandiri Persero | Mitra Pinasthika vs. Bank Central Asia | Mitra Pinasthika vs. Indofood Sukses Makmur |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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