Correlation Between Bank Rakyat and CurrentC Power
Can any of the company-specific risk be diversified away by investing in both Bank Rakyat and CurrentC Power 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 Bank Rakyat and CurrentC Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Rakyat and CurrentC Power, you can compare the effects of market volatilities on Bank Rakyat and CurrentC Power 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 Bank Rakyat with a short position of CurrentC Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Rakyat and CurrentC Power.
Diversification Opportunities for Bank Rakyat and CurrentC Power
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and CurrentC is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Bank Rakyat and CurrentC Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CurrentC Power and Bank Rakyat 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 Bank Rakyat are associated (or correlated) with CurrentC Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CurrentC Power has no effect on the direction of Bank Rakyat i.e., Bank Rakyat and CurrentC Power go up and down completely randomly.
Pair Corralation between Bank Rakyat and CurrentC Power
Assuming the 90 days horizon Bank Rakyat is expected to under-perform the CurrentC Power. But the pink sheet apears to be less risky and, when comparing its historical volatility, Bank Rakyat is 18.02 times less risky than CurrentC Power. The pink sheet trades about -0.43 of its potential returns per unit of risk. The CurrentC Power is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 12.00 in CurrentC Power on August 24, 2024 and sell it today you would earn a total of 11.00 from holding CurrentC Power or generate 91.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Bank Rakyat vs. CurrentC Power
Performance |
| Timeline |
| Bank Rakyat |
| CurrentC Power |
Bank Rakyat and CurrentC Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Rakyat and CurrentC Power
The main advantage of trading using opposite Bank Rakyat and CurrentC Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Rakyat position performs unexpectedly, CurrentC Power 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 CurrentC Power will offset losses from the drop in CurrentC Power's long position.| Bank Rakyat vs. Eurobank Ergasias Services | Bank Rakyat vs. Nedbank Group | Bank Rakyat vs. Standard Bank Group | Bank Rakyat vs. Bank Central Asia |
| CurrentC Power vs. Zhihu Inc ADR | CurrentC Power vs. Postal Realty Trust | CurrentC Power vs. Nike Inc | CurrentC Power vs. Eastern Co |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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