Correlation Between PT Bank and Nordea Bank
Can any of the company-specific risk be diversified away by investing in both PT Bank and Nordea Bank 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 Nordea Bank 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 Nordea Bank Abp, you can compare the effects of market volatilities on PT Bank and Nordea Bank 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 Nordea Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Nordea Bank.
Diversification Opportunities for PT Bank and Nordea Bank
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between BKRKF and Nordea is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Nordea Bank Abp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordea Bank Abp 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 Nordea Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordea Bank Abp has no effect on the direction of PT Bank i.e., PT Bank and Nordea Bank go up and down completely randomly.
Pair Corralation between PT Bank and Nordea Bank
Assuming the 90 days horizon PT Bank Rakyat is expected to generate 4.89 times more return on investment than Nordea Bank. However, PT Bank is 4.89 times more volatile than Nordea Bank Abp. It trades about 0.05 of its potential returns per unit of risk. Nordea Bank Abp is currently generating about 0.0 per unit of risk. If you would invest 28.00 in PT Bank Rakyat on September 13, 2024 and sell it today you would earn a total of 1.00 from holding PT Bank Rakyat or generate 3.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bank Rakyat vs. Nordea Bank Abp
Performance |
| Timeline |
| PT Bank Rakyat |
| Nordea Bank Abp |
PT Bank and Nordea Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Nordea Bank
The main advantage of trading using opposite PT Bank and Nordea Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Nordea Bank 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 Nordea Bank will offset losses from the drop in Nordea Bank's 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 |
| Nordea Bank vs. United Overseas Bank | Nordea Bank vs. KBC Groep NV | Nordea Bank vs. Bank Mandiri Persero | Nordea Bank vs. Overseas Chinese Banking |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |