Correlation Between Bank Rakyat and Autopedia Sukses
Can any of the company-specific risk be diversified away by investing in both Bank Rakyat and Autopedia Sukses 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 Rakyat and Autopedia Sukses into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Rakyat Indonesia and Autopedia Sukses Lestari, you can compare the effects of market volatilities on Bank Rakyat and Autopedia Sukses 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 Rakyat with a short position of Autopedia Sukses. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Rakyat and Autopedia Sukses.
Diversification Opportunities for Bank Rakyat and Autopedia Sukses
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bank and Autopedia is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Bank Rakyat Indonesia and Autopedia Sukses Lestari in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autopedia Sukses Lestari and Bank Rakyat 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 Rakyat Indonesia are associated (or correlated) with Autopedia Sukses. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autopedia Sukses Lestari has no effect on the direction of Bank Rakyat i.e., Bank Rakyat and Autopedia Sukses go up and down completely randomly.
Pair Corralation between Bank Rakyat and Autopedia Sukses
Assuming the 90 days trading horizon Bank Rakyat Indonesia is expected to generate 0.48 times more return on investment than Autopedia Sukses. However, Bank Rakyat Indonesia is 2.08 times less risky than Autopedia Sukses. It trades about 0.01 of its potential returns per unit of risk. Autopedia Sukses Lestari is currently generating about 0.0 per unit of risk. If you would invest 428,088 in Bank Rakyat Indonesia on August 27, 2024 and sell it today you would earn a total of 7,912 from holding Bank Rakyat Indonesia or generate 1.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.77% |
| Values | Daily Returns |
Bank Rakyat Indonesia vs. Autopedia Sukses Lestari
Performance |
| Timeline |
| Bank Rakyat Indonesia |
| Autopedia Sukses Lestari |
Bank Rakyat and Autopedia Sukses Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Rakyat and Autopedia Sukses
The main advantage of trading using opposite Bank Rakyat and Autopedia Sukses positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Rakyat position performs unexpectedly, Autopedia Sukses 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 Autopedia Sukses will offset losses from the drop in Autopedia Sukses' long position.| Bank Rakyat vs. Bank Central Asia | Bank Rakyat vs. Bank Mandiri Persero | Bank Rakyat vs. Bank Negara Indonesia | Bank Rakyat vs. Telkom Indonesia Tbk |
| Autopedia Sukses vs. Adaro Minerals Indonesia | Autopedia Sukses vs. Dharma Polimetal Tbk | Autopedia Sukses vs. Wir Asia Tbk | Autopedia Sukses vs. Adi Sarana Armada |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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