Correlation Between Aneka Tambang and ACDC Metals
Can any of the company-specific risk be diversified away by investing in both Aneka Tambang and ACDC Metals 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 Aneka Tambang and ACDC Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aneka Tambang Tbk and ACDC Metals, you can compare the effects of market volatilities on Aneka Tambang and ACDC Metals 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 Aneka Tambang with a short position of ACDC Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aneka Tambang and ACDC Metals.
Diversification Opportunities for Aneka Tambang and ACDC Metals
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Aneka and ACDC is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Aneka Tambang Tbk and ACDC Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ACDC Metals and Aneka Tambang 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 Aneka Tambang Tbk are associated (or correlated) with ACDC Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ACDC Metals has no effect on the direction of Aneka Tambang i.e., Aneka Tambang and ACDC Metals go up and down completely randomly.
Pair Corralation between Aneka Tambang and ACDC Metals
Assuming the 90 days trading horizon Aneka Tambang Tbk is expected to under-perform the ACDC Metals. But the stock apears to be less risky and, when comparing its historical volatility, Aneka Tambang Tbk is 3.88 times less risky than ACDC Metals. The stock trades about -0.08 of its potential returns per unit of risk. The ACDC Metals is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 7.50 in ACDC Metals on August 25, 2024 and sell it today you would lose (2.00) from holding ACDC Metals or give up 26.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aneka Tambang Tbk vs. ACDC Metals
Performance |
| Timeline |
| Aneka Tambang Tbk |
| ACDC Metals |
Aneka Tambang and ACDC Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aneka Tambang and ACDC Metals
The main advantage of trading using opposite Aneka Tambang and ACDC Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aneka Tambang position performs unexpectedly, ACDC Metals 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 ACDC Metals will offset losses from the drop in ACDC Metals' long position.| Aneka Tambang vs. Aurelia Metals | Aneka Tambang vs. Pinnacle Investment Management | Aneka Tambang vs. Alternative Investment Trust | Aneka Tambang vs. Aeon Metals |
| ACDC Metals vs. Duxton Broadacre Farms | ACDC Metals vs. Skycity Entertainment Group | ACDC Metals vs. Gold Road Resources | ACDC Metals vs. Carlton Investments |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |