Correlation Between Aneka Tambang and Renascor Resources
Can any of the company-specific risk be diversified away by investing in both Aneka Tambang and Renascor Resources 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 Renascor Resources 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 Renascor Resources, you can compare the effects of market volatilities on Aneka Tambang and Renascor Resources 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 Renascor Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aneka Tambang and Renascor Resources.
Diversification Opportunities for Aneka Tambang and Renascor Resources
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aneka and Renascor is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Aneka Tambang Tbk and Renascor Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Renascor Resources 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 Renascor Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Renascor Resources has no effect on the direction of Aneka Tambang i.e., Aneka Tambang and Renascor Resources go up and down completely randomly.
Pair Corralation between Aneka Tambang and Renascor Resources
Assuming the 90 days trading horizon Aneka Tambang Tbk is expected to generate 0.59 times more return on investment than Renascor Resources. However, Aneka Tambang Tbk is 1.69 times less risky than Renascor Resources. It trades about 0.32 of its potential returns per unit of risk. Renascor Resources is currently generating about -0.25 per unit of risk. If you would invest 86.00 in Aneka Tambang Tbk on September 25, 2024 and sell it today you would earn a total of 8.00 from holding Aneka Tambang Tbk or generate 9.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Aneka Tambang Tbk vs. Renascor Resources
Performance |
| Timeline |
| Aneka Tambang Tbk |
| Renascor Resources |
Aneka Tambang and Renascor Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aneka Tambang and Renascor Resources
The main advantage of trading using opposite Aneka Tambang and Renascor Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aneka Tambang position performs unexpectedly, Renascor Resources 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 Renascor Resources will offset losses from the drop in Renascor Resources' long position.| Aneka Tambang vs. Seven West Media | Aneka Tambang vs. Homeco Daily Needs | Aneka Tambang vs. Land Homes Group | Aneka Tambang vs. oOhMedia |
| Renascor Resources vs. Northern Star Resources | Renascor Resources vs. Evolution Mining | Renascor Resources vs. Bluescope Steel | Renascor Resources vs. Aneka Tambang Tbk |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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