Correlation Between Mastercard and Indofood Sukses
Can any of the company-specific risk be diversified away by investing in both Mastercard and Indofood Sukses 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 Mastercard and Indofood Sukses into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mastercard and Indofood Sukses Makmur, you can compare the effects of market volatilities on Mastercard and Indofood Sukses 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 Mastercard with a short position of Indofood Sukses. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mastercard and Indofood Sukses.
Diversification Opportunities for Mastercard and Indofood Sukses
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Mastercard and Indofood is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Mastercard and Indofood Sukses Makmur in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indofood Sukses Makmur and Mastercard 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 Mastercard are associated (or correlated) with Indofood Sukses. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indofood Sukses Makmur has no effect on the direction of Mastercard i.e., Mastercard and Indofood Sukses go up and down completely randomly.
Pair Corralation between Mastercard and Indofood Sukses
Allowing for the 90-day total investment horizon Mastercard is expected to generate 0.45 times more return on investment than Indofood Sukses. However, Mastercard is 2.22 times less risky than Indofood Sukses. It trades about 0.12 of its potential returns per unit of risk. Indofood Sukses Makmur is currently generating about 0.01 per unit of risk. If you would invest 36,171 in Mastercard on December 30, 2023 and sell it today you would earn a total of 11,986 from holding Mastercard or generate 33.14% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Mastercard vs. Indofood Sukses Makmur
Performance |
Timeline |
Mastercard |
Indofood Sukses Makmur |
Mastercard and Indofood Sukses Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Mastercard and Indofood Sukses
The main advantage of trading using opposite Mastercard and Indofood Sukses positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mastercard position performs unexpectedly, Indofood Sukses 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 Indofood Sukses will offset losses from the drop in Indofood Sukses' long position.Mastercard vs. MDB Capital Holdings | Mastercard vs. Orix Corp Ads | Mastercard vs. LendingClub Corp | Mastercard vs. Lexinfintech Holdings |
Indofood Sukses vs. Kraft Heinz Co | Indofood Sukses vs. General Mills | Indofood Sukses vs. Danone PK | Indofood Sukses vs. Kellanova |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
Global Correlations Find global opportunities by holding instruments from different markets | |
Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
Fundamental Analysis View fundamental data based on most recent published financial statements | |
Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |