Correlation Between Timah Persero and Aneka Gas
Can any of the company-specific risk be diversified away by investing in both Timah Persero and Aneka Gas 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 Timah Persero and Aneka Gas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Timah Persero Tbk and Aneka Gas Industri, you can compare the effects of market volatilities on Timah Persero and Aneka Gas 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 Timah Persero with a short position of Aneka Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Timah Persero and Aneka Gas.
Diversification Opportunities for Timah Persero and Aneka Gas
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Timah and Aneka is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Timah Persero Tbk and Aneka Gas Industri in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aneka Gas Industri and Timah Persero 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 Timah Persero Tbk are associated (or correlated) with Aneka Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aneka Gas Industri has no effect on the direction of Timah Persero i.e., Timah Persero and Aneka Gas go up and down completely randomly.
Pair Corralation between Timah Persero and Aneka Gas
Assuming the 90 days trading horizon Timah Persero Tbk is expected to generate 1.79 times more return on investment than Aneka Gas. However, Timah Persero is 1.79 times more volatile than Aneka Gas Industri. It trades about 0.01 of its potential returns per unit of risk. Aneka Gas Industri is currently generating about -0.03 per unit of risk. If you would invest 113,745 in Timah Persero Tbk on September 5, 2024 and sell it today you would lose (6,245) from holding Timah Persero Tbk or give up 5.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Timah Persero Tbk vs. Aneka Gas Industri
Performance |
| Timeline |
| Timah Persero Tbk |
| Aneka Gas Industri |
Timah Persero and Aneka Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Timah Persero and Aneka Gas
The main advantage of trading using opposite Timah Persero and Aneka Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Timah Persero position performs unexpectedly, Aneka Gas 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 Gas will offset losses from the drop in Aneka Gas' long position.| Timah Persero vs. Semen Indonesia Persero | Timah Persero vs. Mitra Pinasthika Mustika | Timah Persero vs. Jakarta Int Hotels | Timah Persero vs. Asuransi Harta Aman |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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