Correlation Between 3D Systems and PT Adaro
Can any of the company-specific risk be diversified away by investing in both 3D Systems and PT Adaro 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 3D Systems and PT Adaro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 3D Systems and PT Adaro Energy, you can compare the effects of market volatilities on 3D Systems and PT Adaro 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 3D Systems with a short position of PT Adaro. Check out your portfolio center. Please also check ongoing floating volatility patterns of 3D Systems and PT Adaro.
Diversification Opportunities for 3D Systems and PT Adaro
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DDD and PADEF is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding 3D Systems and PT Adaro Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Adaro Energy and 3D Systems 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 3D Systems are associated (or correlated) with PT Adaro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Adaro Energy has no effect on the direction of 3D Systems i.e., 3D Systems and PT Adaro go up and down completely randomly.
Pair Corralation between 3D Systems and PT Adaro
Considering the 90-day investment horizon 3D Systems is expected to under-perform the PT Adaro. But the stock apears to be less risky and, when comparing its historical volatility, 3D Systems is 2.41 times less risky than PT Adaro. The stock trades about -0.03 of its potential returns per unit of risk. The PT Adaro Energy is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 18.00 in PT Adaro Energy on September 3, 2024 and sell it today you would earn a total of 4.00 from holding PT Adaro Energy or generate 22.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 8.48% |
| Values | Daily Returns |
3D Systems vs. PT Adaro Energy
Performance |
| Timeline |
| 3D Systems |
| PT Adaro Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
3D Systems and PT Adaro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 3D Systems and PT Adaro
The main advantage of trading using opposite 3D Systems and PT Adaro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 3D Systems position performs unexpectedly, PT Adaro 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 PT Adaro will offset losses from the drop in PT Adaro's long position.| 3D Systems vs. Desktop Metal | 3D Systems vs. Nano Dimension | 3D Systems vs. Markforged Holding Corp | 3D Systems vs. Stratasys |
| PT Adaro vs. Morien Resources Corp | PT Adaro vs. Adaro Energy Tbk | PT Adaro vs. Alliance Resource Partners | PT Adaro vs. Brera Holdings PLC |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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