Correlation Between PT Bank and RMG Acquisition
Can any of the company-specific risk be diversified away by investing in both PT Bank and RMG Acquisition 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 RMG Acquisition 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 RMG Acquisition Corp, you can compare the effects of market volatilities on PT Bank and RMG Acquisition 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 RMG Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and RMG Acquisition.
Diversification Opportunities for PT Bank and RMG Acquisition
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BKRKF and RMG is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and RMG Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RMG Acquisition Corp 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 RMG Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RMG Acquisition Corp has no effect on the direction of PT Bank i.e., PT Bank and RMG Acquisition go up and down completely randomly.
Pair Corralation between PT Bank and RMG Acquisition
If you would invest 26.00 in PT Bank Rakyat on September 1, 2024 and sell it today you would lose (1.00) from holding PT Bank Rakyat or give up 3.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
PT Bank Rakyat vs. RMG Acquisition Corp
Performance |
| Timeline |
| PT Bank Rakyat |
| RMG Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
PT Bank and RMG Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and RMG Acquisition
The main advantage of trading using opposite PT Bank and RMG Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, RMG Acquisition 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 RMG Acquisition will offset losses from the drop in RMG Acquisition'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 |
| RMG Acquisition vs. Hudson Acquisition I | RMG Acquisition vs. Alpha One | RMG Acquisition vs. Manaris Corp | RMG Acquisition vs. Marblegate Acquisition 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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