Correlation Between Perusahaan Perseroan and AURUBIS

Can any of the company-specific risk be diversified away by investing in both Perusahaan Perseroan and AURUBIS 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 Perusahaan Perseroan and AURUBIS into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Perusahaan Perseroan PT and AURUBIS, you can compare the effects of market volatilities on Perusahaan Perseroan and AURUBIS 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 Perusahaan Perseroan with a short position of AURUBIS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perusahaan Perseroan and AURUBIS.

Diversification Opportunities for Perusahaan Perseroan and AURUBIS

-0.43

Correlation Coefficient

Perusahaan Perseroan  AURUBIS

Very good diversification

The 3 months correlation between Perusahaan and AURUBIS is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Perusahaan Perseroan PT and AURUBIS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AURUBIS and Perusahaan Perseroan 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 Perusahaan Perseroan PT are associated (or correlated) with AURUBIS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AURUBIS has no effect on the direction of Perusahaan Perseroan i.e., Perusahaan Perseroan and AURUBIS go up and down completely randomly.

Pair Corralation between Perusahaan Perseroan and AURUBIS

Assuming the 90 days horizon Perusahaan Perseroan PT is expected to under-perform the AURUBIS. In addition to that, Perusahaan Perseroan is 1.26 times more volatile than AURUBIS. It trades about -0.01 of its total potential returns per unit of risk. AURUBIS is currently generating about 0.06 per unit of volatility. If you would invest  6,985  in AURUBIS on October 24, 2024 and sell it today you would earn a total of  545.00  from holding AURUBIS or generate 7.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.33%
Values	Daily Returns

Perusahaan Perseroan PT  vs.  AURUBIS

Perusahaan Perseroan

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Perusahaan Perseroan PT has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Perusahaan Perseroan is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

AURUBIS

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in AURUBIS are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, AURUBIS may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Perusahaan Perseroan and AURUBIS

The main advantage of trading using opposite Perusahaan Perseroan and AURUBIS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perusahaan Perseroan position performs unexpectedly, AURUBIS 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 AURUBIS will offset losses from the drop in AURUBIS's long position.

The idea behind Perusahaan Perseroan PT and AURUBIS pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.