Correlation Between PT Global and Platinum Investment
Can any of the company-specific risk be diversified away by investing in both PT Global and Platinum Investment 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 PT Global and Platinum Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Global Mediacom and Platinum Investment Management, you can compare the effects of market volatilities on PT Global and Platinum Investment 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 PT Global with a short position of Platinum Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Global and Platinum Investment.
Diversification Opportunities for PT Global and Platinum Investment
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 06L and Platinum is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding PT Global Mediacom and Platinum Investment Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Platinum Investment and PT Global 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 PT Global Mediacom are associated (or correlated) with Platinum Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Platinum Investment has no effect on the direction of PT Global i.e., PT Global and Platinum Investment go up and down completely randomly.
Pair Corralation between PT Global and Platinum Investment
Assuming the 90 days trading horizon PT Global Mediacom is expected to under-perform the Platinum Investment. But the stock apears to be less risky and, when comparing its historical volatility, PT Global Mediacom is 1.37 times less risky than Platinum Investment. The stock trades about -0.23 of its potential returns per unit of risk. The Platinum Investment Management is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 40.00 in Platinum Investment Management on September 26, 2024 and sell it today you would lose (1.00) from holding Platinum Investment Management or give up 2.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Global Mediacom vs. Platinum Investment Management
Performance |
| Timeline |
| PT Global Mediacom |
| Platinum Investment |
PT Global and Platinum Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Global and Platinum Investment
The main advantage of trading using opposite PT Global and Platinum Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Global position performs unexpectedly, Platinum Investment 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 Platinum Investment will offset losses from the drop in Platinum Investment's long position.| PT Global vs. The Walt Disney | PT Global vs. Charter Communications | PT Global vs. Warner Music Group | PT Global vs. ViacomCBS |
| Platinum Investment vs. Tianjin Capital Environmental | Platinum Investment vs. DAIRY FARM INTL | Platinum Investment vs. BlueScope Steel Limited | Platinum Investment vs. NIPPON STEEL SPADR |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |