Correlation Between Sariguna Primatirta and Medikaloka Hermina
Can any of the company-specific risk be diversified away by investing in both Sariguna Primatirta and Medikaloka Hermina 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 Sariguna Primatirta and Medikaloka Hermina into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sariguna Primatirta PT and Medikaloka Hermina PT, you can compare the effects of market volatilities on Sariguna Primatirta and Medikaloka Hermina 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 Sariguna Primatirta with a short position of Medikaloka Hermina. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sariguna Primatirta and Medikaloka Hermina.
Diversification Opportunities for Sariguna Primatirta and Medikaloka Hermina
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Sariguna and Medikaloka is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Sariguna Primatirta PT and Medikaloka Hermina PT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Medikaloka Hermina and Sariguna Primatirta 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 Sariguna Primatirta PT are associated (or correlated) with Medikaloka Hermina. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Medikaloka Hermina has no effect on the direction of Sariguna Primatirta i.e., Sariguna Primatirta and Medikaloka Hermina go up and down completely randomly.
Pair Corralation between Sariguna Primatirta and Medikaloka Hermina
Assuming the 90 days trading horizon Sariguna Primatirta PT is expected to generate 0.79 times more return on investment than Medikaloka Hermina. However, Sariguna Primatirta PT is 1.27 times less risky than Medikaloka Hermina. It trades about 0.43 of its potential returns per unit of risk. Medikaloka Hermina PT is currently generating about 0.23 per unit of risk. If you would invest 88,500 in Sariguna Primatirta PT on February 21, 2024 and sell it today you would earn a total of 30,500 from holding Sariguna Primatirta PT or generate 34.46% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 94.74% |
Values | Daily Returns |
Sariguna Primatirta PT vs. Medikaloka Hermina PT
Performance |
Timeline |
Sariguna Primatirta |
Medikaloka Hermina |
Sariguna Primatirta and Medikaloka Hermina Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sariguna Primatirta and Medikaloka Hermina
The main advantage of trading using opposite Sariguna Primatirta and Medikaloka Hermina positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sariguna Primatirta position performs unexpectedly, Medikaloka Hermina 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 Medikaloka Hermina will offset losses from the drop in Medikaloka Hermina's long position.Sariguna Primatirta vs. Fast Food Indonesia | Sariguna Primatirta vs. Enseval Putra Megatrading | Sariguna Primatirta vs. Matahari Putra Prima | Sariguna Primatirta vs. Hexindo Adiperkasa 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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