Correlation Between PT Bank and United States
Can any of the company-specific risk be diversified away by investing in both PT Bank and United States 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 United States 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 United States Cellular, you can compare the effects of market volatilities on PT Bank and United States 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 United States. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and United States.
Diversification Opportunities for PT Bank and United States
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between BKRKF and United is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and United States Cellular in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United States Cellular 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 United States. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United States Cellular has no effect on the direction of PT Bank i.e., PT Bank and United States go up and down completely randomly.
Pair Corralation between PT Bank and United States
Assuming the 90 days horizon PT Bank Rakyat is expected to generate 23.38 times more return on investment than United States. However, PT Bank is 23.38 times more volatile than United States Cellular. It trades about 0.05 of its potential returns per unit of risk. United States Cellular is currently generating about 0.05 per unit of risk. If you would invest 24.00 in PT Bank Rakyat on November 18, 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 | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bank Rakyat vs. United States Cellular
Performance |
| Timeline |
| PT Bank Rakyat |
| United States Cellular |
PT Bank and United States Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and United States
The main advantage of trading using opposite PT Bank and United States positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, United States 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 United States will offset losses from the drop in United States' long position.| PT Bank vs. Banco Bradesco SA | PT Bank vs. Itau Unibanco Banco | PT Bank vs. Lloyds Banking Group | PT Bank vs. Deutsche Bank AG |
| United States vs. United States Cellular | United States vs. United States Cellular | United States vs. Office Properties Income | United States vs. KKRS |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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