Correlation Between Aneka Tambang and Data3
Can any of the company-specific risk be diversified away by investing in both Aneka Tambang and Data3 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 Data3 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 Data3, you can compare the effects of market volatilities on Aneka Tambang and Data3 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 Data3. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aneka Tambang and Data3.
Diversification Opportunities for Aneka Tambang and Data3
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Aneka and Data3 is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Aneka Tambang Tbk and Data3 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Data3 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 Data3. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Data3 has no effect on the direction of Aneka Tambang i.e., Aneka Tambang and Data3 go up and down completely randomly.
Pair Corralation between Aneka Tambang and Data3
Assuming the 90 days trading horizon Aneka Tambang Tbk is expected to under-perform the Data3. But the stock apears to be less risky and, when comparing its historical volatility, Aneka Tambang Tbk is 1.21 times less risky than Data3. The stock trades about -0.06 of its potential returns per unit of risk. The Data3 is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 758.00 in Data3 on September 3, 2024 and sell it today you would earn a total of 21.00 from holding Data3 or generate 2.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aneka Tambang Tbk vs. Data3
Performance |
| Timeline |
| Aneka Tambang Tbk |
| Data3 |
Aneka Tambang and Data3 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aneka Tambang and Data3
The main advantage of trading using opposite Aneka Tambang and Data3 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aneka Tambang position performs unexpectedly, Data3 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 Data3 will offset losses from the drop in Data3's long position.| Aneka Tambang vs. Fisher Paykel Healthcare | Aneka Tambang vs. Capitol Health | Aneka Tambang vs. Nine Entertainment Co | Aneka Tambang vs. Lendlease Group |
| Data3 vs. Commonwealth Bank | Data3 vs. Commonwealth Bank of | Data3 vs. Champion Iron | Data3 vs. iShares Global Healthcare |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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