Correlation Between Armada Hflr and Dharma Polimetal
Can any of the company-specific risk be diversified away by investing in both Armada Hflr and Dharma Polimetal 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 Armada Hflr and Dharma Polimetal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Armada Hflr Pr and Dharma Polimetal Tbk, you can compare the effects of market volatilities on Armada Hflr and Dharma Polimetal 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 Armada Hflr with a short position of Dharma Polimetal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and Dharma Polimetal.
Diversification Opportunities for Armada Hflr and Dharma Polimetal
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Armada and Dharma is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and Dharma Polimetal Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dharma Polimetal Tbk and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with Dharma Polimetal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dharma Polimetal Tbk has no effect on the direction of Armada Hflr i.e., Armada Hflr and Dharma Polimetal go up and down completely randomly.
Pair Corralation between Armada Hflr and Dharma Polimetal
Considering the 90-day investment horizon Armada Hflr Pr is expected to generate 0.96 times more return on investment than Dharma Polimetal. However, Armada Hflr Pr is 1.04 times less risky than Dharma Polimetal. It trades about -0.08 of its potential returns per unit of risk. Dharma Polimetal Tbk is currently generating about -0.1 per unit of risk. If you would invest 1,185 in Armada Hflr Pr on September 14, 2024 and sell it today you would lose (97.00) from holding Armada Hflr Pr or give up 8.19% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 98.41% |
Values | Daily Returns |
Armada Hflr Pr vs. Dharma Polimetal Tbk
Performance |
Timeline |
Armada Hflr Pr |
Dharma Polimetal Tbk |
Armada Hflr and Dharma Polimetal Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Armada Hflr and Dharma Polimetal
The main advantage of trading using opposite Armada Hflr and Dharma Polimetal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Armada Hflr position performs unexpectedly, Dharma Polimetal 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 Dharma Polimetal will offset losses from the drop in Dharma Polimetal's long position.Armada Hflr vs. Modiv Inc | Armada Hflr vs. Precinct Properties New | Armada Hflr vs. Global Net Lease | Armada Hflr vs. NexPoint Diversified Real |
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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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