Correlation Between PT Bank and Toray Industries
Can any of the company-specific risk be diversified away by investing in both PT Bank and Toray Industries 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 Toray Industries 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 Toray Industries, you can compare the effects of market volatilities on PT Bank and Toray Industries 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 Toray Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Toray Industries.
Diversification Opportunities for PT Bank and Toray Industries
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BKRKF and Toray is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Toray Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Toray Industries 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 Toray Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Toray Industries has no effect on the direction of PT Bank i.e., PT Bank and Toray Industries go up and down completely randomly.
Pair Corralation between PT Bank and Toray Industries
Assuming the 90 days horizon PT Bank Rakyat is expected to generate 8.55 times more return on investment than Toray Industries. However, PT Bank is 8.55 times more volatile than Toray Industries. It trades about 0.04 of its potential returns per unit of risk. Toray Industries is currently generating about 0.14 per unit of risk. If you would invest 24.00 in PT Bank Rakyat on November 26, 2024 and sell it today you would lose (1.00) from holding PT Bank Rakyat or give up 4.17% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 88.0% |
Values | Daily Returns |
PT Bank Rakyat vs. Toray Industries
Performance |
Timeline |
PT Bank Rakyat |
Toray Industries |
PT Bank and Toray Industries Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with PT Bank and Toray Industries
The main advantage of trading using opposite PT Bank and Toray Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Toray Industries 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 Toray Industries will offset losses from the drop in Toray Industries' long position.PT Bank vs. Bank Mandiri Persero | ||
PT Bank vs. Piraeus Bank SA | ||
PT Bank vs. Eurobank Ergasias Services | ||
PT Bank vs. Kasikornbank Public Co |
Toray Industries vs. Unifi Inc | ||
Toray Industries vs. Albany International | ||
Toray Industries vs. Toray Industries ADR | ||
Toray Industries vs. Sumitomo Electric Industries |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |