Correlation Between PT Bank and Main Street
Can any of the company-specific risk be diversified away by investing in both PT Bank and Main Street 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 Main Street 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 Main Street Financial, you can compare the effects of market volatilities on PT Bank and Main Street 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 Main Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Main Street.
Diversification Opportunities for PT Bank and Main Street
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BKRKF and Main is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Main Street Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Main Street Financial 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 Main Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Main Street Financial has no effect on the direction of PT Bank i.e., PT Bank and Main Street go up and down completely randomly.
Pair Corralation between PT Bank and Main Street
Assuming the 90 days horizon PT Bank Rakyat is expected to generate 2.23 times more return on investment than Main Street. However, PT Bank is 2.23 times more volatile than Main Street Financial. It trades about 0.03 of its potential returns per unit of risk. Main Street Financial is currently generating about 0.0 per unit of risk. If you would invest 25.00 in PT Bank Rakyat on September 14, 2024 and sell it today you would earn a total of 1.00 from holding PT Bank Rakyat or generate 4.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 81.78% |
| Values | Daily Returns |
PT Bank Rakyat vs. Main Street Financial
Performance |
| Timeline |
| PT Bank Rakyat |
| Main Street Financial |
PT Bank and Main Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Main Street
The main advantage of trading using opposite PT Bank and Main Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Main Street 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 Main Street will offset losses from the drop in Main Street'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 |
| Main Street vs. PT Bank Rakyat | Main Street vs. Morningstar Unconstrained Allocation | Main Street vs. Bondbloxx ETF Trust | Main Street 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |