Correlation Between Treasury Wine and Aneka Tambang
Can any of the company-specific risk be diversified away by investing in both Treasury Wine 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 Treasury Wine and Aneka Tambang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Treasury Wine Estates and Aneka Tambang Tbk, you can compare the effects of market volatilities on Treasury Wine 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 Treasury Wine with a short position of Aneka Tambang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Treasury Wine and Aneka Tambang.
Diversification Opportunities for Treasury Wine and Aneka Tambang
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Treasury and Aneka is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Treasury Wine Estates 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 Treasury Wine 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 Treasury Wine Estates 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 Treasury Wine i.e., Treasury Wine and Aneka Tambang go up and down completely randomly.
Pair Corralation between Treasury Wine and Aneka Tambang
Assuming the 90 days trading horizon Treasury Wine Estates is expected to generate 0.68 times more return on investment than Aneka Tambang. However, Treasury Wine Estates is 1.48 times less risky than Aneka Tambang. It trades about -0.06 of its potential returns per unit of risk. Aneka Tambang Tbk is currently generating about -0.1 per unit of risk. If you would invest 1,173 in Treasury Wine Estates on August 29, 2024 and sell it today you would lose (26.00) from holding Treasury Wine Estates or give up 2.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Treasury Wine Estates vs. Aneka Tambang Tbk
Performance |
| Timeline |
| Treasury Wine Estates |
| Aneka Tambang Tbk |
Treasury Wine and Aneka Tambang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Treasury Wine and Aneka Tambang
The main advantage of trading using opposite Treasury Wine and Aneka Tambang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Treasury Wine 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.| Treasury Wine vs. Aneka Tambang Tbk | Treasury Wine vs. Commonwealth Bank of | Treasury Wine vs. ANZ Group Holdings | Treasury Wine vs. Australia and New |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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