Correlation Between Retail Food and Aneka Tambang
Can any of the company-specific risk be diversified away by investing in both Retail Food 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 Retail Food and Aneka Tambang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Retail Food Group and Aneka Tambang Tbk, you can compare the effects of market volatilities on Retail Food 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 Retail Food with a short position of Aneka Tambang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Retail Food and Aneka Tambang.
Diversification Opportunities for Retail Food and Aneka Tambang
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Retail and Aneka is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Retail Food Group 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 Retail Food 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 Retail Food Group 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 Retail Food i.e., Retail Food and Aneka Tambang go up and down completely randomly.
Pair Corralation between Retail Food and Aneka Tambang
Assuming the 90 days trading horizon Retail Food Group is expected to generate 17.89 times more return on investment than Aneka Tambang. However, Retail Food is 17.89 times more volatile than Aneka Tambang Tbk. It trades about 0.02 of its potential returns per unit of risk. Aneka Tambang Tbk is currently generating about -0.21 per unit of risk. If you would invest 192.00 in Retail Food Group on January 12, 2025 and sell it today you would earn a total of 1.00 from holding Retail Food Group or generate 0.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Retail Food Group vs. Aneka Tambang Tbk
Performance |
| Timeline |
| Retail Food Group |
| Aneka Tambang Tbk |
Retail Food and Aneka Tambang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Retail Food and Aneka Tambang
The main advantage of trading using opposite Retail Food and Aneka Tambang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Retail Food 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.| Retail Food vs. Carlton Investments | Retail Food vs. Flagship Investments | Retail Food vs. Australian United Investment | Retail Food vs. Auctus Alternative Investments |
| Aneka Tambang vs. MFF Capital Investments | Aneka Tambang vs. A1 Investments Resources | Aneka Tambang vs. Navigator Global Investments | Aneka Tambang vs. Flagship Investments |
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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