Correlation Between PT Bank and Smoore International
Can any of the company-specific risk be diversified away by investing in both PT Bank and Smoore International 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 Smoore International 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 Smoore International Holdings, you can compare the effects of market volatilities on PT Bank and Smoore International 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 Smoore International. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Smoore International.
Diversification Opportunities for PT Bank and Smoore International
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BKRKF and Smoore is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Smoore International Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smoore International 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 Smoore International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smoore International has no effect on the direction of PT Bank i.e., PT Bank and Smoore International go up and down completely randomly.
Pair Corralation between PT Bank and Smoore International
Assuming the 90 days horizon PT Bank is expected to generate 3.7 times less return on investment than Smoore International. In addition to that, PT Bank is 1.51 times more volatile than Smoore International Holdings. It trades about 0.01 of its total potential returns per unit of risk. Smoore International Holdings is currently generating about 0.08 per unit of volatility. If you would invest 67.00 in Smoore International Holdings on August 29, 2024 and sell it today you would earn a total of 55.00 from holding Smoore International Holdings or generate 82.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 85.08% |
| Values | Daily Returns |
PT Bank Rakyat vs. Smoore International Holdings
Performance |
| Timeline |
| PT Bank Rakyat |
| Smoore International |
PT Bank and Smoore International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Smoore International
The main advantage of trading using opposite PT Bank and Smoore International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Smoore International 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 Smoore International will offset losses from the drop in Smoore International's long position.The idea behind PT Bank Rakyat and Smoore International Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Smoore International vs. Imperial Brands PLC | Smoore International vs. RLX Technology | Smoore International vs. British American Tobacco | Smoore International vs. Turning Point Brands |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |