Correlation Between Aneka Tambang and Venus Metals
Can any of the company-specific risk be diversified away by investing in both Aneka Tambang and Venus 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 Venus 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 Venus Metals, you can compare the effects of market volatilities on Aneka Tambang and Venus 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 Venus Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aneka Tambang and Venus Metals.
Diversification Opportunities for Aneka Tambang and Venus Metals
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aneka and Venus is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Aneka Tambang Tbk and Venus Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Venus 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 Venus Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Venus Metals has no effect on the direction of Aneka Tambang i.e., Aneka Tambang and Venus Metals go up and down completely randomly.
Pair Corralation between Aneka Tambang and Venus Metals
Assuming the 90 days trading horizon Aneka Tambang Tbk is expected to under-perform the Venus Metals. But the stock apears to be less risky and, when comparing its historical volatility, Aneka Tambang Tbk is 4.26 times less risky than Venus Metals. The stock trades about -0.04 of its potential returns per unit of risk. The Venus Metals is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 10.00 in Venus Metals on November 3, 2024 and sell it today you would lose (3.60) from holding Venus Metals or give up 36.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aneka Tambang Tbk vs. Venus Metals
Performance |
| Timeline |
| Aneka Tambang Tbk |
| Venus Metals |
Aneka Tambang and Venus Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aneka Tambang and Venus Metals
The main advantage of trading using opposite Aneka Tambang and Venus Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aneka Tambang position performs unexpectedly, Venus 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 Venus Metals will offset losses from the drop in Venus Metals' long position.| Aneka Tambang vs. Bisalloy Steel Group | Aneka Tambang vs. Duxton Broadacre Farms | Aneka Tambang vs. Galena Mining | Aneka Tambang vs. Treasury Wine Estates |
| Venus Metals vs. Neurotech International | Venus Metals vs. Oceania Healthcare | Venus Metals vs. Anteris Technologies | Venus Metals vs. Thorney Technologies |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |