Correlation Between Bk Harda and Bank Net
Can any of the company-specific risk be diversified away by investing in both Bk Harda and Bank Net 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 Bk Harda and Bank Net into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bk Harda Internasional and Bank Net Indonesia, you can compare the effects of market volatilities on Bk Harda and Bank Net 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 Bk Harda with a short position of Bank Net. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bk Harda and Bank Net.
Diversification Opportunities for Bk Harda and Bank Net
Very weak diversification
The 3 months correlation between BBHI and Bank is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Bk Harda Internasional and Bank Net Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Net Indonesia and Bk Harda 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 Bk Harda Internasional are associated (or correlated) with Bank Net. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Net Indonesia has no effect on the direction of Bk Harda i.e., Bk Harda and Bank Net go up and down completely randomly.
Pair Corralation between Bk Harda and Bank Net
Assuming the 90 days trading horizon Bk Harda Internasional is expected to under-perform the Bank Net. In addition to that, Bk Harda is 2.94 times more volatile than Bank Net Indonesia. It trades about -0.02 of its total potential returns per unit of risk. Bank Net Indonesia is currently generating about -0.04 per unit of volatility. If you would invest 90,000 in Bank Net Indonesia on November 3, 2024 and sell it today you would lose (8,000) from holding Bank Net Indonesia or give up 8.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bk Harda Internasional vs. Bank Net Indonesia
Performance |
| Timeline |
| Bk Harda Internasional |
| Bank Net Indonesia |
Bk Harda and Bank Net Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bk Harda and Bank Net
The main advantage of trading using opposite Bk Harda and Bank Net positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bk Harda position performs unexpectedly, Bank Net 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 Net will offset losses from the drop in Bank Net's long position.| Bk Harda vs. Bank Artos Indonesia | Bk Harda vs. Bank Yudha Bhakti | Bk Harda vs. Bank Ganesha Tbk | Bk Harda vs. Bank Rakyat Indonesia |
| Bank Net vs. Bank Artos Indonesia | Bank Net vs. Bank Yudha Bhakti | Bank Net vs. Bk Harda Internasional | Bank Net vs. Bank Rakyat Indonesia |
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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