Correlation Between Bank Rakyat and PT Jasa
Can any of the company-specific risk be diversified away by investing in both Bank Rakyat and PT Jasa 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 PT Jasa 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 PT Jasa Berdikari, you can compare the effects of market volatilities on Bank Rakyat and PT Jasa 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 PT Jasa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Rakyat and PT Jasa.
Diversification Opportunities for Bank Rakyat and PT Jasa
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and LAJU is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Bank Rakyat Indonesia and PT Jasa Berdikari in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Jasa Berdikari 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 PT Jasa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Jasa Berdikari has no effect on the direction of Bank Rakyat i.e., Bank Rakyat and PT Jasa go up and down completely randomly.
Pair Corralation between Bank Rakyat and PT Jasa
Assuming the 90 days trading horizon Bank Rakyat Indonesia is expected to generate 0.43 times more return on investment than PT Jasa. However, Bank Rakyat Indonesia is 2.3 times less risky than PT Jasa. It trades about -0.02 of its potential returns per unit of risk. PT Jasa Berdikari is currently generating about -0.08 per unit of risk. If you would invest 512,540 in Bank Rakyat Indonesia on September 2, 2024 and sell it today you would lose (86,540) from holding Bank Rakyat Indonesia or give up 16.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.72% |
| Values | Daily Returns |
Bank Rakyat Indonesia vs. PT Jasa Berdikari
Performance |
| Timeline |
| Bank Rakyat Indonesia |
| PT Jasa Berdikari |
Bank Rakyat and PT Jasa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Rakyat and PT Jasa
The main advantage of trading using opposite Bank Rakyat and PT Jasa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Rakyat position performs unexpectedly, PT Jasa 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 PT Jasa will offset losses from the drop in PT Jasa's 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 |
| PT Jasa vs. Victoria Insurance Tbk | PT Jasa vs. Equity Development Investment | PT Jasa vs. Anabatic Technologies Tbk | PT Jasa vs. Metrodata Electronics Tbk |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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