Correlation Between Bank Agris and Bank Ganesha
Can any of the company-specific risk be diversified away by investing in both Bank Agris and Bank Ganesha 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 Bank Agris and Bank Ganesha into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Agris Tbk and Bank Ganesha Tbk, you can compare the effects of market volatilities on Bank Agris and Bank Ganesha 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 Bank Agris with a short position of Bank Ganesha. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Agris and Bank Ganesha.
Diversification Opportunities for Bank Agris and Bank Ganesha
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and Bank is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Bank Agris Tbk and Bank Ganesha Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Ganesha Tbk and Bank Agris 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 Bank Agris Tbk are associated (or correlated) with Bank Ganesha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Ganesha Tbk has no effect on the direction of Bank Agris i.e., Bank Agris and Bank Ganesha go up and down completely randomly.
Pair Corralation between Bank Agris and Bank Ganesha
Assuming the 90 days trading horizon Bank Agris Tbk is expected to generate 1.62 times more return on investment than Bank Ganesha. However, Bank Agris is 1.62 times more volatile than Bank Ganesha Tbk. It trades about 0.07 of its potential returns per unit of risk. Bank Ganesha Tbk is currently generating about -0.08 per unit of risk. If you would invest 7,300 in Bank Agris Tbk on October 22, 2024 and sell it today you would earn a total of 200.00 from holding Bank Agris Tbk or generate 2.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Agris Tbk vs. Bank Ganesha Tbk
Performance |
| Timeline |
| Bank Agris Tbk |
| Bank Ganesha Tbk |
Bank Agris and Bank Ganesha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Agris and Bank Ganesha
The main advantage of trading using opposite Bank Agris and Bank Ganesha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Agris position performs unexpectedly, Bank Ganesha 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 Bank Ganesha will offset losses from the drop in Bank Ganesha's long position.| Bank Agris vs. Bank Ganesha Tbk | Bank Agris vs. Bank Yudha Bhakti | Bank Agris vs. Bk Harda Internasional | Bank Agris vs. Bank Mnc Internasional |
| Bank Ganesha vs. Bk Harda Internasional | Bank Ganesha vs. Bank Yudha Bhakti | Bank Ganesha vs. Bank Mnc Internasional | Bank Ganesha vs. Bank Capital Indonesia |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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