Correlation Between Bank Bukopin and Bank Maybank
Can any of the company-specific risk be diversified away by investing in both Bank Bukopin and Bank Maybank 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 Bukopin and Bank Maybank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Bukopin Tbk and Bank Maybank Indonesia, you can compare the effects of market volatilities on Bank Bukopin and Bank Maybank 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 Bukopin with a short position of Bank Maybank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Bukopin and Bank Maybank.
Diversification Opportunities for Bank Bukopin and Bank Maybank
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Bank and Bank is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Bank Bukopin Tbk and Bank Maybank Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Maybank Indonesia and Bank Bukopin 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 Bukopin Tbk are associated (or correlated) with Bank Maybank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Maybank Indonesia has no effect on the direction of Bank Bukopin i.e., Bank Bukopin and Bank Maybank go up and down completely randomly.
Pair Corralation between Bank Bukopin and Bank Maybank
Assuming the 90 days trading horizon Bank Bukopin Tbk is expected to generate 1.49 times more return on investment than Bank Maybank. However, Bank Bukopin is 1.49 times more volatile than Bank Maybank Indonesia. It trades about 0.02 of its potential returns per unit of risk. Bank Maybank Indonesia is currently generating about -0.01 per unit of risk. If you would invest 5,300 in Bank Bukopin Tbk on September 2, 2024 and sell it today you would earn a total of 200.00 from holding Bank Bukopin Tbk or generate 3.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Bukopin Tbk vs. Bank Maybank Indonesia
Performance |
| Timeline |
| Bank Bukopin Tbk |
| Bank Maybank Indonesia |
Bank Bukopin and Bank Maybank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Bukopin and Bank Maybank
The main advantage of trading using opposite Bank Bukopin and Bank Maybank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Bukopin position performs unexpectedly, Bank Maybank 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 Maybank will offset losses from the drop in Bank Maybank's long position.| Bank Bukopin vs. Bank Danamon Indonesia | Bank Bukopin vs. Bank Cimb Niaga | Bank Bukopin vs. Bank Tabungan Negara | Bank Bukopin vs. Bank Jabar |
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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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