Correlation Between Bank Tabungan and Bank Maybank
Can any of the company-specific risk be diversified away by investing in both Bank Tabungan and Bank Maybank 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 Tabungan and Bank Maybank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Tabungan Negara and Bank Maybank Indonesia, you can compare the effects of market volatilities on Bank Tabungan and Bank Maybank 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 Tabungan with a short position of Bank Maybank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Tabungan and Bank Maybank.
Diversification Opportunities for Bank Tabungan and Bank Maybank
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and Bank is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Bank Tabungan Negara and Bank Maybank Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Maybank Indonesia and Bank Tabungan 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 Tabungan Negara are associated (or correlated) with Bank Maybank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Maybank Indonesia has no effect on the direction of Bank Tabungan i.e., Bank Tabungan and Bank Maybank go up and down completely randomly.
Pair Corralation between Bank Tabungan and Bank Maybank
Assuming the 90 days trading horizon Bank Tabungan Negara is expected to generate 1.15 times more return on investment than Bank Maybank. However, Bank Tabungan is 1.15 times more volatile than Bank Maybank Indonesia. It trades about 0.01 of its potential returns per unit of risk. Bank Maybank Indonesia is currently generating about -0.02 per unit of risk. If you would invest 130,066 in Bank Tabungan Negara on September 1, 2024 and sell it today you would lose (1,566) from holding Bank Tabungan Negara or give up 1.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Tabungan Negara vs. Bank Maybank Indonesia
Performance |
| Timeline |
| Bank Tabungan Negara |
| Bank Maybank Indonesia |
Bank Tabungan and Bank Maybank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Tabungan and Bank Maybank
The main advantage of trading using opposite Bank Tabungan and Bank Maybank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Tabungan position performs unexpectedly, Bank Maybank 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 Bank Maybank will offset losses from the drop in Bank Maybank's long position.| Bank Tabungan vs. Bank BRISyariah Tbk | Bank Tabungan vs. Ace Hardware Indonesia | Bank Tabungan vs. Merdeka Copper Gold | Bank Tabungan vs. Mitra Pinasthika Mustika |
| Bank Maybank vs. Bank Cimb Niaga | Bank Maybank vs. Bank Danamon Indonesia | Bank Maybank vs. Bank Pan Indonesia | Bank Maybank vs. Bank Permata 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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