Correlation Between PT Bank and Universal Media
Can any of the company-specific risk be diversified away by investing in both PT Bank and Universal Media 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 Universal Media 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 Universal Media Group, you can compare the effects of market volatilities on PT Bank and Universal Media 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 Universal Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Universal Media.
Diversification Opportunities for PT Bank and Universal Media
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BKRKF and Universal is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Universal Media Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Media Group 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 Universal Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Media Group has no effect on the direction of PT Bank i.e., PT Bank and Universal Media go up and down completely randomly.
Pair Corralation between PT Bank and Universal Media
Assuming the 90 days horizon PT Bank Rakyat is expected to generate 0.37 times more return on investment than Universal Media. However, PT Bank Rakyat is 2.74 times less risky than Universal Media. It trades about 0.03 of its potential returns per unit of risk. Universal Media Group is currently generating about 0.0 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 Together |
| Strength | Significant |
| Accuracy | 99.21% |
| Values | Daily Returns |
PT Bank Rakyat vs. Universal Media Group
Performance |
| Timeline |
| PT Bank Rakyat |
| Universal Media Group |
PT Bank and Universal Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Universal Media
The main advantage of trading using opposite PT Bank and Universal Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Universal Media 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 Universal Media will offset losses from the drop in Universal Media'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 |
| Universal Media vs. Mesa Air Group | Universal Media vs. Southwest Airlines | Universal Media vs. Paiute Oil Mining | Universal Media vs. Alaska Air 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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