Correlation Between Perusahaan Perseroan and Alphamin Resources

Can any of the company-specific risk be diversified away by investing in both Perusahaan Perseroan and Alphamin Resources 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 Alphamin Resources 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 Alphamin Resources Corp, you can compare the effects of market volatilities on Perusahaan Perseroan and Alphamin Resources 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 Alphamin Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perusahaan Perseroan and Alphamin Resources.

Diversification Opportunities for Perusahaan Perseroan and Alphamin Resources

-0.8

Correlation Coefficient

Perusahaan Perseroan  Alphamin Resources

Pay attention - limited upside

The 3 months correlation between Perusahaan and Alphamin is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Perusahaan Perseroan PT and Alphamin Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alphamin Resources Corp 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 Alphamin Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alphamin Resources Corp has no effect on the direction of Perusahaan Perseroan i.e., Perusahaan Perseroan and Alphamin Resources go up and down completely randomly.

Pair Corralation between Perusahaan Perseroan and Alphamin Resources

Assuming the 90 days horizon Perusahaan Perseroan PT is expected to under-perform the Alphamin Resources. But the stock apears to be less risky and, when comparing its historical volatility, Perusahaan Perseroan PT is 2.99 times less risky than Alphamin Resources. The stock trades about -0.24 of its potential returns per unit of risk. The Alphamin Resources Corp is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest  67.00  in Alphamin Resources Corp on February 5, 2024 and sell it today you would earn a total of  13.00  from holding Alphamin Resources Corp or generate 19.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	95.24%
Values	Daily Returns

Perusahaan Perseroan PT  vs.  Alphamin Resources Corp

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 fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in June 2024. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Alphamin Resources Corp

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Alphamin Resources Corp are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, Alphamin Resources reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Perusahaan Perseroan and Alphamin Resources

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

The idea behind Perusahaan Perseroan PT and Alphamin Resources Corp 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.

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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.