Correlation Between Bank Negara and Bekasi Asri
Can any of the company-specific risk be diversified away by investing in both Bank Negara and Bekasi Asri 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 Negara and Bekasi Asri into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Negara Indonesia and Bekasi Asri Pemula, you can compare the effects of market volatilities on Bank Negara and Bekasi Asri 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 Negara with a short position of Bekasi Asri. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Negara and Bekasi Asri.
Diversification Opportunities for Bank Negara and Bekasi Asri
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and Bekasi is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Bank Negara Indonesia and Bekasi Asri Pemula in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bekasi Asri Pemula and Bank Negara 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 Negara Indonesia are associated (or correlated) with Bekasi Asri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bekasi Asri Pemula has no effect on the direction of Bank Negara i.e., Bank Negara and Bekasi Asri go up and down completely randomly.
Pair Corralation between Bank Negara and Bekasi Asri
Assuming the 90 days trading horizon Bank Negara Indonesia is expected to under-perform the Bekasi Asri. But the stock apears to be less risky and, when comparing its historical volatility, Bank Negara Indonesia is 1.69 times less risky than Bekasi Asri. The stock trades about -0.1 of its potential returns per unit of risk. The Bekasi Asri Pemula is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 5,800 in Bekasi Asri Pemula on September 2, 2024 and sell it today you would lose (200.00) from holding Bekasi Asri Pemula or give up 3.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Negara Indonesia vs. Bekasi Asri Pemula
Performance |
| Timeline |
| Bank Negara Indonesia |
| Bekasi Asri Pemula |
Bank Negara and Bekasi Asri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Negara and Bekasi Asri
The main advantage of trading using opposite Bank Negara and Bekasi Asri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Negara position performs unexpectedly, Bekasi Asri 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 Asri will offset losses from the drop in Bekasi Asri's long position.| Bank Negara vs. Ace Hardware Indonesia | Bank Negara vs. Merdeka Copper Gold | Bank Negara vs. Mitra Pinasthika Mustika | Bank Negara vs. Jakarta Int Hotels |
| Bekasi Asri vs. Lippo Cikarang Tbk | Bekasi Asri vs. Lippo Karawaci Tbk | Bekasi Asri vs. Mitra Pinasthika Mustika | Bekasi Asri vs. Jakarta Int Hotels |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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