Correlation Between Bank Bukopin and Arkadia Digital
Can any of the company-specific risk be diversified away by investing in both Bank Bukopin and Arkadia Digital 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 Arkadia Digital 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 Arkadia Digital Media, you can compare the effects of market volatilities on Bank Bukopin and Arkadia Digital 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 Arkadia Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Bukopin and Arkadia Digital.
Diversification Opportunities for Bank Bukopin and Arkadia Digital
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and Arkadia is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Bank Bukopin Tbk and Arkadia Digital Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arkadia Digital Media 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 Arkadia Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arkadia Digital Media has no effect on the direction of Bank Bukopin i.e., Bank Bukopin and Arkadia Digital go up and down completely randomly.
Pair Corralation between Bank Bukopin and Arkadia Digital
Assuming the 90 days trading horizon Bank Bukopin Tbk is expected to generate 0.48 times more return on investment than Arkadia Digital. However, Bank Bukopin Tbk is 2.06 times less risky than Arkadia Digital. It trades about -0.13 of its potential returns per unit of risk. Arkadia Digital Media is currently generating about -0.16 per unit of risk. If you would invest 5,900 in Bank Bukopin Tbk on August 31, 2024 and sell it today you would lose (300.00) from holding Bank Bukopin Tbk or give up 5.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Bukopin Tbk vs. Arkadia Digital Media
Performance |
| Timeline |
| Bank Bukopin Tbk |
| Arkadia Digital Media |
Bank Bukopin and Arkadia Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Bukopin and Arkadia Digital
The main advantage of trading using opposite Bank Bukopin and Arkadia Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Bukopin position performs unexpectedly, Arkadia Digital 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 Arkadia Digital will offset losses from the drop in Arkadia Digital'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 |
| Arkadia Digital vs. Electronic City Indonesia | Arkadia Digital vs. MD Pictures Tbk | Arkadia Digital vs. Bintang Oto Global | Arkadia Digital vs. Graha Layar Prima |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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