Correlation Between Amkor Technology and PT Bank
Can any of the company-specific risk be diversified away by investing in both Amkor Technology 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 Amkor Technology and PT Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amkor Technology and PT Bank Maybank, you can compare the effects of market volatilities on Amkor Technology 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 Amkor Technology with a short position of PT Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amkor Technology and PT Bank.
Diversification Opportunities for Amkor Technology and PT Bank
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Amkor and BOZA is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Amkor Technology and PT Bank Maybank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Bank Maybank and Amkor Technology 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 Amkor Technology 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 Maybank has no effect on the direction of Amkor Technology i.e., Amkor Technology and PT Bank go up and down completely randomly.
Pair Corralation between Amkor Technology and PT Bank
Assuming the 90 days horizon Amkor Technology is expected to generate 1.67 times less return on investment than PT Bank. But when comparing it to its historical volatility, Amkor Technology is 1.51 times less risky than PT Bank. It trades about 0.01 of its potential returns per unit of risk. PT Bank Maybank is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1.50 in PT Bank Maybank on September 4, 2024 and sell it today you would lose (0.25) from holding PT Bank Maybank or give up 16.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Amkor Technology vs. PT Bank Maybank
Performance |
| Timeline |
| Amkor Technology |
| PT Bank Maybank |
Amkor Technology and PT Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amkor Technology and PT Bank
The main advantage of trading using opposite Amkor Technology and PT Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amkor Technology 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.| Amkor Technology vs. NVIDIA | Amkor Technology vs. Taiwan Semiconductor Manufacturing | Amkor Technology vs. Advanced Micro Devices | Amkor Technology vs. Intel |
| PT Bank vs. Magic Software Enterprises | PT Bank vs. Constellation Software | PT Bank vs. Sqs Software Quality | PT Bank vs. Soken Chemical Engineering |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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