Correlation Between TBS Energi and Abm Investama
Can any of the company-specific risk be diversified away by investing in both TBS Energi and Abm Investama 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 TBS Energi and Abm Investama into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TBS Energi Utama and Abm Investama Tbk, you can compare the effects of market volatilities on TBS Energi and Abm Investama 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 TBS Energi with a short position of Abm Investama. Check out your portfolio center. Please also check ongoing floating volatility patterns of TBS Energi and Abm Investama.
Diversification Opportunities for TBS Energi and Abm Investama
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between TBS and Abm is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding TBS Energi Utama and Abm Investama Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abm Investama Tbk and TBS Energi 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 TBS Energi Utama are associated (or correlated) with Abm Investama. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abm Investama Tbk has no effect on the direction of TBS Energi i.e., TBS Energi and Abm Investama go up and down completely randomly.
Pair Corralation between TBS Energi and Abm Investama
Assuming the 90 days trading horizon TBS Energi Utama is expected to under-perform the Abm Investama. In addition to that, TBS Energi is 1.6 times more volatile than Abm Investama Tbk. It trades about 0.0 of its total potential returns per unit of risk. Abm Investama Tbk is currently generating about 0.04 per unit of volatility. If you would invest 274,585 in Abm Investama Tbk on August 30, 2024 and sell it today you would earn a total of 80,415 from holding Abm Investama Tbk or generate 29.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TBS Energi Utama vs. Abm Investama Tbk
Performance |
| Timeline |
| TBS Energi Utama |
| Abm Investama Tbk |
TBS Energi and Abm Investama Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TBS Energi and Abm Investama
The main advantage of trading using opposite TBS Energi and Abm Investama positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TBS Energi position performs unexpectedly, Abm Investama 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 Abm Investama will offset losses from the drop in Abm Investama's long position.| TBS Energi vs. Golden Eagle Energy | TBS Energi vs. Baramulti Suksessarana Tbk | TBS Energi vs. Samindo Resources Tbk | TBS Energi vs. Resource Alam Indonesia |
| Abm Investama vs. Baramulti Suksessarana Tbk | Abm Investama vs. Mitrabara Adiperdana PT | Abm Investama vs. Sumber Alfaria Trijaya | Abm Investama vs. Surya Esa Perkasa |
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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