Correlation Between Mystate and Aneka Tambang
Can any of the company-specific risk be diversified away by investing in both Mystate 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 Mystate and Aneka Tambang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mystate and Aneka Tambang Tbk, you can compare the effects of market volatilities on Mystate 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 Mystate with a short position of Aneka Tambang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mystate and Aneka Tambang.
Diversification Opportunities for Mystate and Aneka Tambang
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mystate and Aneka is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Mystate 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 Mystate 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 Mystate 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 Mystate i.e., Mystate and Aneka Tambang go up and down completely randomly.
Pair Corralation between Mystate and Aneka Tambang
Assuming the 90 days trading horizon Mystate is expected to generate 1.22 times more return on investment than Aneka Tambang. However, Mystate is 1.22 times more volatile than Aneka Tambang Tbk. It trades about 0.08 of its potential returns per unit of risk. Aneka Tambang Tbk is currently generating about -0.03 per unit of risk. If you would invest 285.00 in Mystate on September 1, 2024 and sell it today you would earn a total of 126.00 from holding Mystate or generate 44.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mystate vs. Aneka Tambang Tbk
Performance |
| Timeline |
| Mystate |
| Aneka Tambang Tbk |
Mystate and Aneka Tambang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mystate and Aneka Tambang
The main advantage of trading using opposite Mystate and Aneka Tambang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mystate 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.| Mystate vs. Alto Metals | Mystate vs. Queste Communications | Mystate vs. Cleanaway Waste Management | Mystate vs. Olivers Real Food |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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