Correlation Between PT Bank and Aurora Acquisition
Can any of the company-specific risk be diversified away by investing in both PT Bank and Aurora Acquisition 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 PT Bank and Aurora Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Bank Rakyat and Aurora Acquisition Corp, you can compare the effects of market volatilities on PT Bank and Aurora Acquisition 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 PT Bank with a short position of Aurora Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Aurora Acquisition.
Diversification Opportunities for PT Bank and Aurora Acquisition
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BKRKF and Aurora is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Aurora Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurora Acquisition Corp and PT Bank 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 PT Bank Rakyat are associated (or correlated) with Aurora Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurora Acquisition Corp has no effect on the direction of PT Bank i.e., PT Bank and Aurora Acquisition go up and down completely randomly.
Pair Corralation between PT Bank and Aurora Acquisition
Assuming the 90 days horizon PT Bank Rakyat is expected to generate 7.19 times more return on investment than Aurora Acquisition. However, PT Bank is 7.19 times more volatile than Aurora Acquisition Corp. It trades about 0.02 of its potential returns per unit of risk. Aurora Acquisition Corp is currently generating about 0.07 per unit of risk. If you would invest 26.00 in PT Bank Rakyat on September 3, 2024 and sell it today you would lose (2.00) from holding PT Bank Rakyat or give up 7.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 37.53% |
| Values | Daily Returns |
PT Bank Rakyat vs. Aurora Acquisition Corp
Performance |
| Timeline |
| PT Bank Rakyat |
| Aurora Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
PT Bank and Aurora Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Aurora Acquisition
The main advantage of trading using opposite PT Bank and Aurora Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Aurora Acquisition 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 Aurora Acquisition will offset losses from the drop in Aurora Acquisition's long position.| PT Bank vs. Bank Mandiri Persero | PT Bank vs. Piraeus Bank SA | PT Bank vs. Eurobank Ergasias Services | PT Bank vs. Kasikornbank Public Co |
| Aurora Acquisition vs. Aehr Test Systems | Aurora Acquisition vs. Everspin Technologies | Aurora Acquisition vs. MACOM Technology Solutions | Aurora Acquisition vs. ON Semiconductor |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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