Correlation Between Bank Rakyat and Solusi Sinergi
Can any of the company-specific risk be diversified away by investing in both Bank Rakyat and Solusi Sinergi 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 Solusi Sinergi 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 Solusi Sinergi Digital, you can compare the effects of market volatilities on Bank Rakyat and Solusi Sinergi 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 Solusi Sinergi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Rakyat and Solusi Sinergi.
Diversification Opportunities for Bank Rakyat and Solusi Sinergi
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and Solusi is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Bank Rakyat Indonesia and Solusi Sinergi Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solusi Sinergi Digital 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 Solusi Sinergi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solusi Sinergi Digital has no effect on the direction of Bank Rakyat i.e., Bank Rakyat and Solusi Sinergi go up and down completely randomly.
Pair Corralation between Bank Rakyat and Solusi Sinergi
Assuming the 90 days trading horizon Bank Rakyat Indonesia is expected to under-perform the Solusi Sinergi. But the stock apears to be less risky and, when comparing its historical volatility, Bank Rakyat Indonesia is 1.96 times less risky than Solusi Sinergi. The stock trades about -0.02 of its potential returns per unit of risk. The Solusi Sinergi Digital is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 18,880 in Solusi Sinergi Digital on September 12, 2024 and sell it today you would earn a total of 22,920 from holding Solusi Sinergi Digital or generate 121.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.69% |
| Values | Daily Returns |
Bank Rakyat Indonesia vs. Solusi Sinergi Digital
Performance |
| Timeline |
| Bank Rakyat Indonesia |
| Solusi Sinergi Digital |
Bank Rakyat and Solusi Sinergi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Rakyat and Solusi Sinergi
The main advantage of trading using opposite Bank Rakyat and Solusi Sinergi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Rakyat position performs unexpectedly, Solusi Sinergi 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 Solusi Sinergi will offset losses from the drop in Solusi Sinergi's long position.| Bank Rakyat vs. Paninvest Tbk | Bank Rakyat vs. Maskapai Reasuransi Indonesia | Bank Rakyat vs. Panin Sekuritas Tbk | Bank Rakyat vs. Wahana Ottomitra Multiartha |
| Solusi Sinergi vs. DCI Indonesia Tbk | Solusi Sinergi vs. Digital Mediatama Maxima | Solusi Sinergi vs. Multipolar Technology Tbk | Solusi Sinergi vs. Bank Net Indonesia |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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