Correlation Between Carnegie Clean and Aneka Tambang
Can any of the company-specific risk be diversified away by investing in both Carnegie Clean 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 Carnegie Clean and Aneka Tambang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carnegie Clean Energy and Aneka Tambang Tbk, you can compare the effects of market volatilities on Carnegie Clean 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 Carnegie Clean with a short position of Aneka Tambang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carnegie Clean and Aneka Tambang.
Diversification Opportunities for Carnegie Clean and Aneka Tambang
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Carnegie and Aneka is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Carnegie Clean Energy 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 Carnegie Clean 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 Carnegie Clean Energy 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 Carnegie Clean i.e., Carnegie Clean and Aneka Tambang go up and down completely randomly.
Pair Corralation between Carnegie Clean and Aneka Tambang
Assuming the 90 days trading horizon Carnegie Clean Energy is expected to generate 1.51 times more return on investment than Aneka Tambang. However, Carnegie Clean is 1.51 times more volatile than Aneka Tambang Tbk. It trades about 0.05 of its potential returns per unit of risk. Aneka Tambang Tbk is currently generating about -0.1 per unit of risk. If you would invest 3.90 in Carnegie Clean Energy on August 25, 2024 and sell it today you would earn a total of 0.10 from holding Carnegie Clean Energy or generate 2.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Carnegie Clean Energy vs. Aneka Tambang Tbk
Performance |
| Timeline |
| Carnegie Clean Energy |
| Aneka Tambang Tbk |
Carnegie Clean and Aneka Tambang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carnegie Clean and Aneka Tambang
The main advantage of trading using opposite Carnegie Clean and Aneka Tambang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carnegie Clean 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.| Carnegie Clean vs. Aneka Tambang Tbk | Carnegie Clean vs. Unibail Rodamco Westfield SE | Carnegie Clean vs. Macquarie Group | Carnegie Clean vs. Commonwealth Bank |
| Aneka Tambang vs. Aurelia Metals | Aneka Tambang vs. Pinnacle Investment Management | Aneka Tambang vs. Alternative Investment Trust | Aneka Tambang vs. Aeon Metals |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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