Correlation Between PT Bank and Wienerberger Baustoffindustri
Can any of the company-specific risk be diversified away by investing in both PT Bank and Wienerberger Baustoffindustri 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 Wienerberger Baustoffindustri 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 Wienerberger Baustoffindustrie, you can compare the effects of market volatilities on PT Bank and Wienerberger Baustoffindustri 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 Wienerberger Baustoffindustri. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Wienerberger Baustoffindustri.
Diversification Opportunities for PT Bank and Wienerberger Baustoffindustri
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BKRKF and Wienerberger is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Wienerberger Baustoffindustrie in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wienerberger Baustoffindustri 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 Wienerberger Baustoffindustri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wienerberger Baustoffindustri has no effect on the direction of PT Bank i.e., PT Bank and Wienerberger Baustoffindustri go up and down completely randomly.
Pair Corralation between PT Bank and Wienerberger Baustoffindustri
Assuming the 90 days horizon PT Bank Rakyat is expected to generate 2.29 times more return on investment than Wienerberger Baustoffindustri. However, PT Bank is 2.29 times more volatile than Wienerberger Baustoffindustrie. It trades about 0.01 of its potential returns per unit of risk. Wienerberger Baustoffindustrie is currently generating about -0.02 per unit of risk. If you would invest 26.00 in PT Bank Rakyat on August 30, 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 | 100.0% |
| Values | Daily Returns |
PT Bank Rakyat vs. Wienerberger Baustoffindustrie
Performance |
| Timeline |
| PT Bank Rakyat |
| Wienerberger Baustoffindustri |
PT Bank and Wienerberger Baustoffindustri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Wienerberger Baustoffindustri
The main advantage of trading using opposite PT Bank and Wienerberger Baustoffindustri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Wienerberger Baustoffindustri 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 Wienerberger Baustoffindustri will offset losses from the drop in Wienerberger Baustoffindustri's long position.| PT Bank vs. Israel Discount Bank | PT Bank vs. Baraboo Bancorporation | PT Bank vs. Danske Bank AS | PT Bank vs. Absa Group Limited |
| Wienerberger Baustoffindustri vs. Xinyi Glass Holdings | Wienerberger Baustoffindustri vs. CEMATRIX | Wienerberger Baustoffindustri vs. CEMEX SAB de | Wienerberger Baustoffindustri vs. China National Building |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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