Correlation Between Asuransi Harta and Bank Negara
Can any of the company-specific risk be diversified away by investing in both Asuransi Harta and Bank Negara 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 Asuransi Harta and Bank Negara into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asuransi Harta Aman and Bank Negara Indonesia, you can compare the effects of market volatilities on Asuransi Harta and Bank Negara 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 Asuransi Harta with a short position of Bank Negara. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asuransi Harta and Bank Negara.
Diversification Opportunities for Asuransi Harta and Bank Negara
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Asuransi and Bank is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Asuransi Harta Aman and Bank Negara Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Negara Indonesia and Asuransi Harta 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 Asuransi Harta Aman are associated (or correlated) with Bank Negara. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Negara Indonesia has no effect on the direction of Asuransi Harta i.e., Asuransi Harta and Bank Negara go up and down completely randomly.
Pair Corralation between Asuransi Harta and Bank Negara
Assuming the 90 days trading horizon Asuransi Harta is expected to generate 1.03 times less return on investment than Bank Negara. But when comparing it to its historical volatility, Asuransi Harta Aman is 1.13 times less risky than Bank Negara. It trades about 0.03 of its potential returns per unit of risk. Bank Negara Indonesia is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 435,736 in Bank Negara Indonesia on September 2, 2024 and sell it today you would earn a total of 62,264 from holding Bank Negara Indonesia or generate 14.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asuransi Harta Aman vs. Bank Negara Indonesia
Performance |
| Timeline |
| Asuransi Harta Aman |
| Bank Negara Indonesia |
Asuransi Harta and Bank Negara Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asuransi Harta and Bank Negara
The main advantage of trading using opposite Asuransi Harta and Bank Negara positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asuransi Harta position performs unexpectedly, Bank Negara 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 Negara will offset losses from the drop in Bank Negara's long position.| Asuransi Harta vs. Asuransi Bintang Tbk | Asuransi Harta vs. Asuransi Bina Dana | Asuransi Harta vs. Asuransi Dayin Mitra | Asuransi Harta vs. Asuransi Jasa Tania |
| Bank Negara vs. Ace Hardware Indonesia | Bank Negara vs. Merdeka Copper Gold | Bank Negara vs. Mitra Pinasthika Mustika | Bank Negara vs. Jakarta Int Hotels |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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