Correlation Between TBS Energi and Golden Eagle
Can any of the company-specific risk be diversified away by investing in both TBS Energi and Golden Eagle 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 Golden Eagle 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 Golden Eagle Energy, you can compare the effects of market volatilities on TBS Energi and Golden Eagle 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 Golden Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of TBS Energi and Golden Eagle.
Diversification Opportunities for TBS Energi and Golden Eagle
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between TBS and Golden is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding TBS Energi Utama and Golden Eagle Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Eagle Energy 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 Golden Eagle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Eagle Energy has no effect on the direction of TBS Energi i.e., TBS Energi and Golden Eagle go up and down completely randomly.
Pair Corralation between TBS Energi and Golden Eagle
Assuming the 90 days trading horizon TBS Energi Utama is expected to under-perform the Golden Eagle. In addition to that, TBS Energi is 1.83 times more volatile than Golden Eagle Energy. It trades about -0.19 of its total potential returns per unit of risk. Golden Eagle Energy is currently generating about 0.07 per unit of volatility. If you would invest 74,000 in Golden Eagle Energy on August 30, 2024 and sell it today you would earn a total of 2,500 from holding Golden Eagle Energy or generate 3.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TBS Energi Utama vs. Golden Eagle Energy
Performance |
| Timeline |
| TBS Energi Utama |
| Golden Eagle Energy |
TBS Energi and Golden Eagle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TBS Energi and Golden Eagle
The main advantage of trading using opposite TBS Energi and Golden Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TBS Energi position performs unexpectedly, Golden Eagle 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 Golden Eagle will offset losses from the drop in Golden Eagle'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 |
| Golden Eagle vs. Resource Alam Indonesia | Golden Eagle vs. J Resources Asia | Golden Eagle vs. TBS Energi Utama | Golden Eagle vs. Rukun Raharja Tbk |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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