Correlation Between Leyand International and Bintang Mitra
Can any of the company-specific risk be diversified away by investing in both Leyand International and Bintang Mitra 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 Leyand International and Bintang Mitra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Leyand International Tbk and Bintang Mitra Semestaraya, you can compare the effects of market volatilities on Leyand International and Bintang Mitra 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 Leyand International with a short position of Bintang Mitra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leyand International and Bintang Mitra.
Diversification Opportunities for Leyand International and Bintang Mitra
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Leyand and Bintang is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Leyand International Tbk and Bintang Mitra Semestaraya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bintang Mitra Semestaraya and Leyand International 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 Leyand International Tbk are associated (or correlated) with Bintang Mitra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bintang Mitra Semestaraya has no effect on the direction of Leyand International i.e., Leyand International and Bintang Mitra go up and down completely randomly.
Pair Corralation between Leyand International and Bintang Mitra
Assuming the 90 days trading horizon Leyand International Tbk is expected to generate 5.58 times more return on investment than Bintang Mitra. However, Leyand International is 5.58 times more volatile than Bintang Mitra Semestaraya. It trades about 0.24 of its potential returns per unit of risk. Bintang Mitra Semestaraya is currently generating about -0.46 per unit of risk. If you would invest 600.00 in Leyand International Tbk on January 29, 2024 and sell it today you would earn a total of 200.00 from holding Leyand International Tbk or generate 33.33% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Leyand International Tbk vs. Bintang Mitra Semestaraya
Performance |
Timeline |
Leyand International Tbk |
Bintang Mitra Semestaraya |
Leyand International and Bintang Mitra Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Leyand International and Bintang Mitra
The main advantage of trading using opposite Leyand International and Bintang Mitra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Leyand International position performs unexpectedly, Bintang Mitra 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 Bintang Mitra will offset losses from the drop in Bintang Mitra's long position.Leyand International vs. Kapuas Prima Coal | Leyand International vs. PP Presisi Tbk | Leyand International vs. Alfa Energi Investama | Leyand International vs. Rukun Raharja Tbk |
Bintang Mitra vs. Kawasan Industri Jababeka | Bintang Mitra vs. Modernland Realty Ltd | Bintang Mitra vs. Multipolar Tbk | Bintang Mitra vs. Lautan Luas Tbk |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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