Correlation Between Metropolitan Land and Jasuindo Tiga
Can any of the company-specific risk be diversified away by investing in both Metropolitan Land and Jasuindo Tiga 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 Metropolitan Land and Jasuindo Tiga into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Metropolitan Land Tbk and Jasuindo Tiga Perkasa, you can compare the effects of market volatilities on Metropolitan Land and Jasuindo Tiga 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 Metropolitan Land with a short position of Jasuindo Tiga. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metropolitan Land and Jasuindo Tiga.
Diversification Opportunities for Metropolitan Land and Jasuindo Tiga
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Metropolitan and Jasuindo is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Metropolitan Land Tbk and Jasuindo Tiga Perkasa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jasuindo Tiga Perkasa and Metropolitan Land 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 Metropolitan Land Tbk are associated (or correlated) with Jasuindo Tiga. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jasuindo Tiga Perkasa has no effect on the direction of Metropolitan Land i.e., Metropolitan Land and Jasuindo Tiga go up and down completely randomly.
Pair Corralation between Metropolitan Land and Jasuindo Tiga
Assuming the 90 days trading horizon Metropolitan Land Tbk is expected to generate 0.43 times more return on investment than Jasuindo Tiga. However, Metropolitan Land Tbk is 2.3 times less risky than Jasuindo Tiga. It trades about -0.21 of its potential returns per unit of risk. Jasuindo Tiga Perkasa is currently generating about -0.26 per unit of risk. If you would invest 39,400 in Metropolitan Land Tbk on January 25, 2024 and sell it today you would lose (1,400) from holding Metropolitan Land Tbk or give up 3.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Metropolitan Land Tbk vs. Jasuindo Tiga Perkasa
Performance |
| Timeline |
| Metropolitan Land Tbk |
| Jasuindo Tiga Perkasa |
Metropolitan Land and Jasuindo Tiga Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metropolitan Land and Jasuindo Tiga
The main advantage of trading using opposite Metropolitan Land and Jasuindo Tiga positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metropolitan Land position performs unexpectedly, Jasuindo Tiga 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 Jasuindo Tiga will offset losses from the drop in Jasuindo Tiga's long position.The idea behind Metropolitan Land Tbk and Jasuindo Tiga Perkasa pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Jasuindo Tiga vs. Unggul Indah Cahaya | Jasuindo Tiga vs. Surya Toto Indonesia | Jasuindo Tiga vs. Pelangi Indah Canindo | Jasuindo Tiga vs. Trias Sentosa 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |