Correlation Between Alto Metals and Aneka Tambang
Can any of the company-specific risk be diversified away by investing in both Alto Metals and Aneka Tambang 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 Alto Metals and Aneka Tambang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alto Metals and Aneka Tambang Tbk, you can compare the effects of market volatilities on Alto Metals and Aneka Tambang 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 Alto Metals with a short position of Aneka Tambang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alto Metals and Aneka Tambang.
Diversification Opportunities for Alto Metals and Aneka Tambang
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Alto and Aneka is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Alto Metals and Aneka Tambang Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aneka Tambang Tbk and Alto Metals 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 Alto Metals are associated (or correlated) with Aneka Tambang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aneka Tambang Tbk has no effect on the direction of Alto Metals i.e., Alto Metals and Aneka Tambang go up and down completely randomly.
Pair Corralation between Alto Metals and Aneka Tambang
Assuming the 90 days trading horizon Alto Metals is expected to generate 1.35 times more return on investment than Aneka Tambang. However, Alto Metals is 1.35 times more volatile than Aneka Tambang Tbk. It trades about 0.18 of its potential returns per unit of risk. Aneka Tambang Tbk is currently generating about -0.08 per unit of risk. If you would invest 6.60 in Alto Metals on September 2, 2024 and sell it today you would earn a total of 2.60 from holding Alto Metals or generate 39.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alto Metals vs. Aneka Tambang Tbk
Performance |
| Timeline |
| Alto Metals |
| Aneka Tambang Tbk |
Alto Metals and Aneka Tambang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alto Metals and Aneka Tambang
The main advantage of trading using opposite Alto Metals and Aneka Tambang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alto Metals position performs unexpectedly, Aneka Tambang 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 Aneka Tambang will offset losses from the drop in Aneka Tambang's long position.| Alto Metals vs. Northern Star Resources | Alto Metals vs. Evolution Mining | Alto Metals vs. Sandfire Resources NL | Alto Metals vs. Aneka Tambang Tbk |
| Aneka Tambang vs. Bio Gene Technology | Aneka Tambang vs. MFF Capital Investments | Aneka Tambang vs. Auctus Alternative Investments | Aneka Tambang vs. ABACUS STORAGE KING |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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