Correlation Between PT Bank and Nova Vision
Can any of the company-specific risk be diversified away by investing in both PT Bank and Nova Vision 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 Nova Vision 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 Nova Vision Acquisition, you can compare the effects of market volatilities on PT Bank and Nova Vision 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 Nova Vision. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Nova Vision.
Diversification Opportunities for PT Bank and Nova Vision
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BKRKF and Nova is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Nova Vision Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nova Vision Acquisition 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 Nova Vision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nova Vision Acquisition has no effect on the direction of PT Bank i.e., PT Bank and Nova Vision go up and down completely randomly.
Pair Corralation between PT Bank and Nova Vision
Assuming the 90 days horizon PT Bank is expected to generate 215.81 times less return on investment than Nova Vision. But when comparing it to its historical volatility, PT Bank Rakyat is 32.75 times less risky than Nova Vision. It trades about 0.03 of its potential returns per unit of risk. Nova Vision Acquisition is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 11.00 in Nova Vision Acquisition on September 1, 2024 and sell it today you would earn a total of 12.00 from holding Nova Vision Acquisition or generate 109.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 45.24% |
| Values | Daily Returns |
PT Bank Rakyat vs. Nova Vision Acquisition
Performance |
| Timeline |
| PT Bank Rakyat |
| Nova Vision Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
PT Bank and Nova Vision Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Nova Vision
The main advantage of trading using opposite PT Bank and Nova Vision positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Nova Vision 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 Nova Vision will offset losses from the drop in Nova Vision's long position.| PT Bank vs. Piraeus Bank SA | PT Bank vs. Turkiye Garanti Bankasi | PT Bank vs. Delhi Bank Corp | PT Bank vs. Uwharrie Capital 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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