Correlation Between AOYAMA TRADING and PT Bank
Can any of the company-specific risk be diversified away by investing in both AOYAMA TRADING and PT Bank 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 AOYAMA TRADING and PT Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AOYAMA TRADING and PT Bank Rakyat, you can compare the effects of market volatilities on AOYAMA TRADING and PT Bank 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 AOYAMA TRADING with a short position of PT Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of AOYAMA TRADING and PT Bank.
Diversification Opportunities for AOYAMA TRADING and PT Bank
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AOYAMA and BYRA is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding AOYAMA TRADING and PT Bank Rakyat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Bank Rakyat and AOYAMA TRADING 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 AOYAMA TRADING are associated (or correlated) with PT Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Bank Rakyat has no effect on the direction of AOYAMA TRADING i.e., AOYAMA TRADING and PT Bank go up and down completely randomly.
Pair Corralation between AOYAMA TRADING and PT Bank
Assuming the 90 days horizon AOYAMA TRADING is expected to generate 0.98 times more return on investment than PT Bank. However, AOYAMA TRADING is 1.02 times less risky than PT Bank. It trades about 0.08 of its potential returns per unit of risk. PT Bank Rakyat is currently generating about 0.02 per unit of risk. If you would invest 576.00 in AOYAMA TRADING on November 3, 2024 and sell it today you would earn a total of 754.00 from holding AOYAMA TRADING or generate 130.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AOYAMA TRADING vs. PT Bank Rakyat
Performance |
| Timeline |
| AOYAMA TRADING |
| PT Bank Rakyat |
AOYAMA TRADING and PT Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AOYAMA TRADING and PT Bank
The main advantage of trading using opposite AOYAMA TRADING and PT Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AOYAMA TRADING position performs unexpectedly, PT Bank 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 Bank will offset losses from the drop in PT Bank's long position.| AOYAMA TRADING vs. Iridium Communications | AOYAMA TRADING vs. Geely Automobile Holdings | AOYAMA TRADING vs. Ribbon Communications | AOYAMA TRADING vs. Cogent Communications Holdings |
| PT Bank vs. FUYO GENERAL LEASE | PT Bank vs. VARIOUS EATERIES LS | PT Bank vs. US FOODS HOLDING | PT Bank vs. Lifeway Foods |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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