Correlation Between Adaro Minerals and Dharma Polimetal
Can any of the company-specific risk be diversified away by investing in both Adaro Minerals and Dharma Polimetal 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 Adaro Minerals and Dharma Polimetal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Adaro Minerals Indonesia and Dharma Polimetal Tbk, you can compare the effects of market volatilities on Adaro Minerals and Dharma Polimetal 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 Adaro Minerals with a short position of Dharma Polimetal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adaro Minerals and Dharma Polimetal.
Diversification Opportunities for Adaro Minerals and Dharma Polimetal
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Adaro and Dharma is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Adaro Minerals Indonesia and Dharma Polimetal Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dharma Polimetal Tbk and Adaro Minerals 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 Adaro Minerals Indonesia are associated (or correlated) with Dharma Polimetal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dharma Polimetal Tbk has no effect on the direction of Adaro Minerals i.e., Adaro Minerals and Dharma Polimetal go up and down completely randomly.
Pair Corralation between Adaro Minerals and Dharma Polimetal
Assuming the 90 days trading horizon Adaro Minerals Indonesia is expected to under-perform the Dharma Polimetal. In addition to that, Adaro Minerals is 1.56 times more volatile than Dharma Polimetal Tbk. It trades about -0.22 of its total potential returns per unit of risk. Dharma Polimetal Tbk is currently generating about -0.13 per unit of volatility. If you would invest 104,500 in Dharma Polimetal Tbk on August 31, 2024 and sell it today you would lose (4,000) from holding Dharma Polimetal Tbk or give up 3.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Adaro Minerals Indonesia vs. Dharma Polimetal Tbk
Performance |
| Timeline |
| Adaro Minerals Indonesia |
| Dharma Polimetal Tbk |
Adaro Minerals and Dharma Polimetal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Adaro Minerals and Dharma Polimetal
The main advantage of trading using opposite Adaro Minerals and Dharma Polimetal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Adaro Minerals position performs unexpectedly, Dharma Polimetal 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 Dharma Polimetal will offset losses from the drop in Dharma Polimetal's long position.| Adaro Minerals vs. Bank Artos Indonesia | Adaro Minerals vs. GoTo Gojek Tokopedia | Adaro Minerals vs. Elang Mahkota Teknologi | Adaro Minerals vs. PT Bukalapak |
| Dharma Polimetal vs. Triputra Agro Persada | Dharma Polimetal vs. Autopedia Sukses Lestari | Dharma Polimetal vs. Cisarua Mountain Dairy | Dharma Polimetal vs. Surya Esa Perkasa |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |