Correlation Between PT Bank and Niagara Mohawk
Can any of the company-specific risk be diversified away by investing in both PT Bank and Niagara Mohawk 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 Niagara Mohawk 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 Niagara Mohawk Power, you can compare the effects of market volatilities on PT Bank and Niagara Mohawk 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 Niagara Mohawk. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Niagara Mohawk.
Diversification Opportunities for PT Bank and Niagara Mohawk
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BKRKF and Niagara is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Niagara Mohawk Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Niagara Mohawk Power 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 Niagara Mohawk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Niagara Mohawk Power has no effect on the direction of PT Bank i.e., PT Bank and Niagara Mohawk go up and down completely randomly.
Pair Corralation between PT Bank and Niagara Mohawk
Assuming the 90 days horizon PT Bank is expected to generate 1.42 times less return on investment than Niagara Mohawk. In addition to that, PT Bank is 4.98 times more volatile than Niagara Mohawk Power. It trades about 0.0 of its total potential returns per unit of risk. Niagara Mohawk Power is currently generating about 0.01 per unit of volatility. If you would invest 6,064 in Niagara Mohawk Power on September 12, 2024 and sell it today you would earn a total of 36.00 from holding Niagara Mohawk Power or generate 0.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bank Rakyat vs. Niagara Mohawk Power
Performance |
| Timeline |
| PT Bank Rakyat |
| Niagara Mohawk Power |
PT Bank and Niagara Mohawk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Niagara Mohawk
The main advantage of trading using opposite PT Bank and Niagara Mohawk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Niagara Mohawk 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 Niagara Mohawk will offset losses from the drop in Niagara Mohawk's long position.| PT Bank vs. Bank Mandiri Persero | PT Bank vs. Morningstar Unconstrained Allocation | PT Bank vs. Bondbloxx ETF Trust | PT Bank vs. Spring Valley Acquisition |
| Niagara Mohawk vs. WiMi Hologram Cloud | Niagara Mohawk vs. Kandi Technologies Group | Niagara Mohawk vs. Ziff Davis | Niagara Mohawk vs. Ark Restaurants Corp |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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