Correlation Between PT Bank and Cannabis Sativa
Can any of the company-specific risk be diversified away by investing in both PT Bank and Cannabis Sativa 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 Cannabis Sativa 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 Cannabis Sativa, you can compare the effects of market volatilities on PT Bank and Cannabis Sativa 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 Cannabis Sativa. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Cannabis Sativa.
Diversification Opportunities for PT Bank and Cannabis Sativa
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BKRKF and Cannabis is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Cannabis Sativa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cannabis Sativa 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 Cannabis Sativa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cannabis Sativa has no effect on the direction of PT Bank i.e., PT Bank and Cannabis Sativa go up and down completely randomly.
Pair Corralation between PT Bank and Cannabis Sativa
Assuming the 90 days horizon PT Bank is expected to generate 7.2 times less return on investment than Cannabis Sativa. But when comparing it to its historical volatility, PT Bank Rakyat is 2.56 times less risky than Cannabis Sativa. It trades about 0.02 of its potential returns per unit of risk. Cannabis Sativa is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 5.00 in Cannabis Sativa on August 26, 2024 and sell it today you would lose (3.78) from holding Cannabis Sativa or give up 75.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 81.89% |
| Values | Daily Returns |
PT Bank Rakyat vs. Cannabis Sativa
Performance |
| Timeline |
| PT Bank Rakyat |
| Cannabis Sativa |
PT Bank and Cannabis Sativa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Cannabis Sativa
The main advantage of trading using opposite PT Bank and Cannabis Sativa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Cannabis Sativa 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 Cannabis Sativa will offset losses from the drop in Cannabis Sativa's long position.| PT Bank vs. Standard Bank Group | PT Bank vs. PSB Holdings | PT Bank vs. United Overseas Bank | PT Bank vs. Turkiye Garanti Bankasi |
| Cannabis Sativa vs. Embotelladora Andina SA | Cannabis Sativa vs. Signet International Holdings | Cannabis Sativa vs. National Beverage Corp | Cannabis Sativa vs. PT Astra International |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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