Correlation Between Black Rock and Aneka Tambang
Can any of the company-specific risk be diversified away by investing in both Black Rock and Aneka Tambang 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 Black Rock and Aneka Tambang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Black Rock Mining and Aneka Tambang Tbk, you can compare the effects of market volatilities on Black Rock and Aneka Tambang 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 Black Rock with a short position of Aneka Tambang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Black Rock and Aneka Tambang.
Diversification Opportunities for Black Rock and Aneka Tambang
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Black and Aneka is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Black Rock Mining and Aneka Tambang Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aneka Tambang Tbk and Black Rock 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 Black Rock Mining are associated (or correlated) with Aneka Tambang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aneka Tambang Tbk has no effect on the direction of Black Rock i.e., Black Rock and Aneka Tambang go up and down completely randomly.
Pair Corralation between Black Rock and Aneka Tambang
Assuming the 90 days trading horizon Black Rock Mining is expected to under-perform the Aneka Tambang. In addition to that, Black Rock is 1.43 times more volatile than Aneka Tambang Tbk. It trades about -0.17 of its total potential returns per unit of risk. Aneka Tambang Tbk is currently generating about -0.13 per unit of volatility. If you would invest 102.00 in Aneka Tambang Tbk on August 30, 2024 and sell it today you would lose (16.00) from holding Aneka Tambang Tbk or give up 15.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Black Rock Mining vs. Aneka Tambang Tbk
Performance |
| Timeline |
| Black Rock Mining |
| Aneka Tambang Tbk |
Black Rock and Aneka Tambang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Black Rock and Aneka Tambang
The main advantage of trading using opposite Black Rock and Aneka Tambang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Black Rock position performs unexpectedly, Aneka Tambang 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 Aneka Tambang will offset losses from the drop in Aneka Tambang's long position.| Black Rock vs. Northern Star Resources | Black Rock vs. Evolution Mining | Black Rock vs. Bluescope Steel | Black Rock vs. Sandfire Resources NL |
| Aneka Tambang vs. Actinogen Medical | Aneka Tambang vs. TTG Fintech | Aneka Tambang vs. IDP Education | Aneka Tambang vs. G8 Education |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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