Correlation Between PAM Mineral and PT Data
Can any of the company-specific risk be diversified away by investing in both PAM Mineral and PT Data 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 PAM Mineral and PT Data into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PAM Mineral Tbk and PT Data Sinergitama, you can compare the effects of market volatilities on PAM Mineral and PT Data 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 PAM Mineral with a short position of PT Data. Check out your portfolio center. Please also check ongoing floating volatility patterns of PAM Mineral and PT Data.
Diversification Opportunities for PAM Mineral and PT Data
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PAM and ELIT is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding PAM Mineral Tbk and PT Data Sinergitama in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Data Sinergitama and PAM Mineral 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 PAM Mineral Tbk are associated (or correlated) with PT Data. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Data Sinergitama has no effect on the direction of PAM Mineral i.e., PAM Mineral and PT Data go up and down completely randomly.
Pair Corralation between PAM Mineral and PT Data
Assuming the 90 days trading horizon PAM Mineral is expected to generate 1.37 times less return on investment than PT Data. But when comparing it to its historical volatility, PAM Mineral Tbk is 1.25 times less risky than PT Data. It trades about 0.05 of its potential returns per unit of risk. PT Data Sinergitama is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 10,900 in PT Data Sinergitama on September 8, 2024 and sell it today you would earn a total of 900.00 from holding PT Data Sinergitama or generate 8.26% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
PAM Mineral Tbk vs. PT Data Sinergitama
Performance |
Timeline |
PAM Mineral Tbk |
PT Data Sinergitama |
PAM Mineral and PT Data Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with PAM Mineral and PT Data
The main advantage of trading using opposite PAM Mineral and PT Data positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PAM Mineral position performs unexpectedly, PT Data 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 PT Data will offset losses from the drop in PT Data's long position.PAM Mineral vs. Archi Indonesia Tbk | PAM Mineral vs. Bumi Resources Minerals | PAM Mineral vs. Bank Panin Syariah | PAM Mineral vs. Central Omega Resources |
PT Data vs. Merdeka Copper Gold | PT Data vs. Dharma Polimetal Tbk | PT Data vs. Nanotech Indonesia Global | PT Data vs. Humpuss Intermoda Transportasi |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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