Correlation Between Benakat Petroleum and Bank Maybank
Can any of the company-specific risk be diversified away by investing in both Benakat Petroleum 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 Benakat Petroleum and Bank Maybank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Benakat Petroleum Energy and Bank Maybank Indonesia, you can compare the effects of market volatilities on Benakat Petroleum 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 Benakat Petroleum with a short position of Bank Maybank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Benakat Petroleum and Bank Maybank.
Diversification Opportunities for Benakat Petroleum and Bank Maybank
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Benakat and Bank is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Benakat Petroleum Energy 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 Benakat Petroleum 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 Benakat Petroleum Energy 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 Benakat Petroleum i.e., Benakat Petroleum and Bank Maybank go up and down completely randomly.
Pair Corralation between Benakat Petroleum and Bank Maybank
Assuming the 90 days trading horizon Benakat Petroleum Energy is expected to generate 5.05 times more return on investment than Bank Maybank. However, Benakat Petroleum is 5.05 times more volatile than Bank Maybank Indonesia. It trades about 0.05 of its potential returns per unit of risk. Bank Maybank Indonesia is currently generating about -0.25 per unit of risk. If you would invest 7,600 in Benakat Petroleum Energy on September 1, 2024 and sell it today you would earn a total of 200.00 from holding Benakat Petroleum Energy or generate 2.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Benakat Petroleum Energy vs. Bank Maybank Indonesia
Performance |
| Timeline |
| Benakat Petroleum Energy |
| Bank Maybank Indonesia |
Benakat Petroleum and Bank Maybank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Benakat Petroleum and Bank Maybank
The main advantage of trading using opposite Benakat Petroleum and Bank Maybank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Benakat Petroleum 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.| Benakat Petroleum vs. Bumi Resources Minerals | Benakat Petroleum vs. Energi Mega Persada | Benakat Petroleum vs. Delta Dunia Makmur | Benakat Petroleum vs. Darma Henwa Tbk |
| 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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