Correlation Between Bank Artos and Bekasi Fajar
Can any of the company-specific risk be diversified away by investing in both Bank Artos and Bekasi Fajar 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 Artos and Bekasi Fajar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Artos Indonesia and Bekasi Fajar Industrial, you can compare the effects of market volatilities on Bank Artos and Bekasi Fajar 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 Artos with a short position of Bekasi Fajar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Artos and Bekasi Fajar.
Diversification Opportunities for Bank Artos and Bekasi Fajar
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and Bekasi is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Bank Artos Indonesia and Bekasi Fajar Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bekasi Fajar Industrial and Bank Artos 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 Artos Indonesia are associated (or correlated) with Bekasi Fajar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bekasi Fajar Industrial has no effect on the direction of Bank Artos i.e., Bank Artos and Bekasi Fajar go up and down completely randomly.
Pair Corralation between Bank Artos and Bekasi Fajar
Assuming the 90 days trading horizon Bank Artos Indonesia is expected to generate 1.25 times more return on investment than Bekasi Fajar. However, Bank Artos is 1.25 times more volatile than Bekasi Fajar Industrial. It trades about -0.14 of its potential returns per unit of risk. Bekasi Fajar Industrial is currently generating about -0.3 per unit of risk. If you would invest 290,000 in Bank Artos Indonesia on August 29, 2024 and sell it today you would lose (26,000) from holding Bank Artos Indonesia or give up 8.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Artos Indonesia vs. Bekasi Fajar Industrial
Performance |
| Timeline |
| Bank Artos Indonesia |
| Bekasi Fajar Industrial |
Bank Artos and Bekasi Fajar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Artos and Bekasi Fajar
The main advantage of trading using opposite Bank Artos and Bekasi Fajar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Artos position performs unexpectedly, Bekasi Fajar 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 Bekasi Fajar will offset losses from the drop in Bekasi Fajar's long position.| Bank Artos vs. Elang Mahkota Teknologi | Bank Artos vs. Bank Yudha Bhakti | Bank Artos vs. Bk Harda Internasional | Bank Artos vs. PT Bukalapak |
| Bekasi Fajar vs. Agung Podomoro Land | Bekasi Fajar vs. Surya Semesta Internusa | Bekasi Fajar vs. Alam Sutera Realty | Bekasi Fajar vs. Bumi Serpong Damai |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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