Correlation Between Asuransi Harta and Bank Bumi
Can any of the company-specific risk be diversified away by investing in both Asuransi Harta and Bank Bumi 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 Bumi 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 Bumi Arta, you can compare the effects of market volatilities on Asuransi Harta and Bank Bumi 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 Bumi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asuransi Harta and Bank Bumi.
Diversification Opportunities for Asuransi Harta and Bank Bumi
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Asuransi and Bank is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Asuransi Harta Aman and Bank Bumi Arta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Bumi Arta 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 Bumi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Bumi Arta has no effect on the direction of Asuransi Harta i.e., Asuransi Harta and Bank Bumi go up and down completely randomly.
Pair Corralation between Asuransi Harta and Bank Bumi
Assuming the 90 days trading horizon Asuransi Harta Aman is expected to under-perform the Bank Bumi. But the stock apears to be less risky and, when comparing its historical volatility, Asuransi Harta Aman is 1.2 times less risky than Bank Bumi. The stock trades about -0.18 of its potential returns per unit of risk. The Bank Bumi Arta is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 71,500 in Bank Bumi Arta on August 31, 2024 and sell it today you would lose (4,000) from holding Bank Bumi Arta or give up 5.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asuransi Harta Aman vs. Bank Bumi Arta
Performance |
| Timeline |
| Asuransi Harta Aman |
| Bank Bumi Arta |
Asuransi Harta and Bank Bumi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asuransi Harta and Bank Bumi
The main advantage of trading using opposite Asuransi Harta and Bank Bumi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asuransi Harta position performs unexpectedly, Bank Bumi 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 Bumi will offset losses from the drop in Bank Bumi'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 Bumi vs. Bank BRISyariah Tbk | Bank Bumi vs. Ace Hardware Indonesia | Bank Bumi vs. Merdeka Copper Gold | Bank Bumi vs. Mitra Pinasthika Mustika |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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