Correlation Between Baraboo Bancorporation and PT Bank
Can any of the company-specific risk be diversified away by investing in both Baraboo Bancorporation 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 Baraboo Bancorporation and PT Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baraboo Bancorporation and PT Bank Rakyat, you can compare the effects of market volatilities on Baraboo Bancorporation 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 Baraboo Bancorporation with a short position of PT Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baraboo Bancorporation and PT Bank.
Diversification Opportunities for Baraboo Bancorporation and PT Bank
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Baraboo and BKRKF is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Baraboo Bancorp. and PT Bank Rakyat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Bank Rakyat and Baraboo Bancorporation 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 Baraboo Bancorporation 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 Rakyat has no effect on the direction of Baraboo Bancorporation i.e., Baraboo Bancorporation and PT Bank go up and down completely randomly.
Pair Corralation between Baraboo Bancorporation and PT Bank
Given the investment horizon of 90 days Baraboo Bancorporation is expected to generate 0.44 times more return on investment than PT Bank. However, Baraboo Bancorporation is 2.29 times less risky than PT Bank. It trades about 0.02 of its potential returns per unit of risk. PT Bank Rakyat is currently generating about 0.0 per unit of risk. If you would invest 302.00 in Baraboo Bancorporation on September 2, 2024 and sell it today you would earn a total of 28.00 from holding Baraboo Bancorporation or generate 9.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 93.07% |
| Values | Daily Returns |
Baraboo Bancorp. vs. PT Bank Rakyat
Performance |
| Timeline |
| Baraboo Bancorporation |
| PT Bank Rakyat |
Baraboo Bancorporation and PT Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baraboo Bancorporation and PT Bank
The main advantage of trading using opposite Baraboo Bancorporation and PT Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baraboo Bancorporation 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.| Baraboo Bancorporation vs. Andover Bancorp | Baraboo Bancorporation vs. Aozora Bank Ltd | Baraboo Bancorporation vs. Israel Discount Bank | Baraboo Bancorporation vs. Schweizerische Nationalbank |
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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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