Correlation Between PT Bank and Harbor Bankshares
Can any of the company-specific risk be diversified away by investing in both PT Bank and Harbor Bankshares 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 Harbor Bankshares 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 Harbor Bankshares, you can compare the effects of market volatilities on PT Bank and Harbor Bankshares 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 Harbor Bankshares. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Harbor Bankshares.
Diversification Opportunities for PT Bank and Harbor Bankshares
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between BKRKF and Harbor is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Harbor Bankshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harbor Bankshares 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 Harbor Bankshares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harbor Bankshares has no effect on the direction of PT Bank i.e., PT Bank and Harbor Bankshares go up and down completely randomly.
Pair Corralation between PT Bank and Harbor Bankshares
Assuming the 90 days horizon PT Bank is expected to generate 1.09 times less return on investment than Harbor Bankshares. In addition to that, PT Bank is 2.61 times more volatile than Harbor Bankshares. It trades about 0.06 of its total potential returns per unit of risk. Harbor Bankshares is currently generating about 0.16 per unit of volatility. If you would invest 1,250 in Harbor Bankshares on September 13, 2024 and sell it today you would earn a total of 114.00 from holding Harbor Bankshares or generate 9.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bank Rakyat vs. Harbor Bankshares
Performance |
| Timeline |
| PT Bank Rakyat |
| Harbor Bankshares |
PT Bank and Harbor Bankshares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Harbor Bankshares
The main advantage of trading using opposite PT Bank and Harbor Bankshares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Harbor Bankshares 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 Harbor Bankshares will offset losses from the drop in Harbor Bankshares' long position.| PT Bank vs. Morningstar Unconstrained Allocation | PT Bank vs. Bondbloxx ETF Trust | PT Bank vs. Spring Valley Acquisition | PT Bank vs. Bondbloxx ETF Trust |
| Harbor Bankshares vs. PT Bank Rakyat | Harbor Bankshares vs. Morningstar Unconstrained Allocation | Harbor Bankshares vs. Bondbloxx ETF Trust | Harbor Bankshares vs. Spring Valley Acquisition |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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