Correlation Between Red Hill and Aneka Tambang
Can any of the company-specific risk be diversified away by investing in both Red Hill 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 Red Hill and Aneka Tambang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Red Hill Iron and Aneka Tambang Tbk, you can compare the effects of market volatilities on Red Hill 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 Red Hill with a short position of Aneka Tambang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Red Hill and Aneka Tambang.
Diversification Opportunities for Red Hill and Aneka Tambang
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Red and Aneka is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Red Hill Iron 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 Red Hill 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 Red Hill Iron 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 Red Hill i.e., Red Hill and Aneka Tambang go up and down completely randomly.
Pair Corralation between Red Hill and Aneka Tambang
Assuming the 90 days trading horizon Red Hill Iron is expected to generate 2.27 times more return on investment than Aneka Tambang. However, Red Hill is 2.27 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 -0.05 per unit of risk. If you would invest 326.00 in Red Hill Iron on September 14, 2024 and sell it today you would earn a total of 105.00 from holding Red Hill Iron or generate 32.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.63% |
| Values | Daily Returns |
Red Hill Iron vs. Aneka Tambang Tbk
Performance |
| Timeline |
| Red Hill Iron |
| Aneka Tambang Tbk |
Red Hill and Aneka Tambang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Red Hill and Aneka Tambang
The main advantage of trading using opposite Red Hill and Aneka Tambang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Red Hill 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.| Red Hill vs. Northern Star Resources | Red Hill vs. Evolution Mining | Red Hill vs. Bluescope Steel | Red Hill vs. Sandfire Resources NL |
| Aneka Tambang vs. Red Hill Iron | Aneka Tambang vs. Phoslock Environmental Technologies | Aneka Tambang vs. Ironbark Capital | Aneka Tambang vs. Capitol Health |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |