Correlation Between PT Bank and Palfinger
Can any of the company-specific risk be diversified away by investing in both PT Bank and Palfinger 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 Palfinger 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 Palfinger AG, you can compare the effects of market volatilities on PT Bank and Palfinger 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 Palfinger. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Palfinger.
Diversification Opportunities for PT Bank and Palfinger
Good diversification
The 3 months correlation between BKRKF and Palfinger is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Palfinger AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Palfinger AG 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 Palfinger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Palfinger AG has no effect on the direction of PT Bank i.e., PT Bank and Palfinger go up and down completely randomly.
Pair Corralation between PT Bank and Palfinger
Assuming the 90 days horizon PT Bank Rakyat is expected to generate 4.67 times more return on investment than Palfinger. However, PT Bank is 4.67 times more volatile than Palfinger AG. It trades about 0.03 of its potential returns per unit of risk. Palfinger AG is currently generating about 0.01 per unit of risk. If you would invest 25.00 in PT Bank Rakyat on September 1, 2024 and sell it today you would earn a total of 0.00 from holding PT Bank Rakyat or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
PT Bank Rakyat vs. Palfinger AG
Performance |
| Timeline |
| PT Bank Rakyat |
| Palfinger AG |
PT Bank and Palfinger Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Palfinger
The main advantage of trading using opposite PT Bank and Palfinger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Palfinger 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 Palfinger will offset losses from the drop in Palfinger'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 |
| Palfinger vs. American Premium Water | Palfinger vs. Arts Way Manufacturing Co | Palfinger vs. Astec Industries | Palfinger vs. Alamo Group |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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