Correlation Between Aneka Tambang and COAST ENTERTAINMENT
Can any of the company-specific risk be diversified away by investing in both Aneka Tambang and COAST ENTERTAINMENT 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 COAST ENTERTAINMENT 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 COAST ENTERTAINMENT HOLDINGS, you can compare the effects of market volatilities on Aneka Tambang and COAST ENTERTAINMENT 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 COAST ENTERTAINMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aneka Tambang and COAST ENTERTAINMENT.
Diversification Opportunities for Aneka Tambang and COAST ENTERTAINMENT
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Aneka and COAST is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Aneka Tambang Tbk and COAST ENTERTAINMENT HOLDINGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COAST ENTERTAINMENT 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 COAST ENTERTAINMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COAST ENTERTAINMENT has no effect on the direction of Aneka Tambang i.e., Aneka Tambang and COAST ENTERTAINMENT go up and down completely randomly.
Pair Corralation between Aneka Tambang and COAST ENTERTAINMENT
Assuming the 90 days trading horizon Aneka Tambang is expected to generate 29.5 times less return on investment than COAST ENTERTAINMENT. But when comparing it to its historical volatility, Aneka Tambang Tbk is 5.31 times less risky than COAST ENTERTAINMENT. It trades about 0.0 of its potential returns per unit of risk. COAST ENTERTAINMENT HOLDINGS is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 49.00 in COAST ENTERTAINMENT HOLDINGS on November 6, 2024 and sell it today you would earn a total of 0.00 from holding COAST ENTERTAINMENT HOLDINGS or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aneka Tambang Tbk vs. COAST ENTERTAINMENT HOLDINGS
Performance |
| Timeline |
| Aneka Tambang Tbk |
| COAST ENTERTAINMENT |
Aneka Tambang and COAST ENTERTAINMENT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aneka Tambang and COAST ENTERTAINMENT
The main advantage of trading using opposite Aneka Tambang and COAST ENTERTAINMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aneka Tambang position performs unexpectedly, COAST ENTERTAINMENT 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 COAST ENTERTAINMENT will offset losses from the drop in COAST ENTERTAINMENT's long position.| Aneka Tambang vs. Perseus Mining | Aneka Tambang vs. Charter Hall Retail | Aneka Tambang vs. ACDC Metals | Aneka Tambang vs. Retail Food Group |
| COAST ENTERTAINMENT vs. Sandon Capital Investments | COAST ENTERTAINMENT vs. Argo Investments | COAST ENTERTAINMENT vs. Auctus Alternative Investments | COAST ENTERTAINMENT vs. Australian Unity Office |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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