Correlation Between Dotz Nano and Aneka Tambang
Can any of the company-specific risk be diversified away by investing in both Dotz Nano 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 Dotz Nano and Aneka Tambang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dotz Nano and Aneka Tambang Tbk, you can compare the effects of market volatilities on Dotz Nano 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 Dotz Nano with a short position of Aneka Tambang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dotz Nano and Aneka Tambang.
Diversification Opportunities for Dotz Nano and Aneka Tambang
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dotz and Aneka is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Dotz Nano 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 Dotz Nano 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 Dotz Nano 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 Dotz Nano i.e., Dotz Nano and Aneka Tambang go up and down completely randomly.
Pair Corralation between Dotz Nano and Aneka Tambang
Assuming the 90 days trading horizon Dotz Nano is expected to generate 4.75 times more return on investment than Aneka Tambang. However, Dotz Nano is 4.75 times more volatile than Aneka Tambang Tbk. It trades about 0.17 of its potential returns per unit of risk. Aneka Tambang Tbk is currently generating about 0.31 per unit of risk. If you would invest 7.70 in Dotz Nano on September 20, 2024 and sell it today you would earn a total of 1.70 from holding Dotz Nano or generate 22.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Dotz Nano vs. Aneka Tambang Tbk
Performance |
| Timeline |
| Dotz Nano |
| Aneka Tambang Tbk |
Dotz Nano and Aneka Tambang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dotz Nano and Aneka Tambang
The main advantage of trading using opposite Dotz Nano and Aneka Tambang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dotz Nano 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.| Dotz Nano vs. Westpac Banking | Dotz Nano vs. Galena Mining | Dotz Nano vs. Black Rock Mining | Dotz Nano vs. Bank of Queensland |
| Aneka Tambang vs. Autosports Group | Aneka Tambang vs. Green Technology Metals | Aneka Tambang vs. Collins Foods | Aneka Tambang vs. Perseus Mining |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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