Correlation Between Bank Rakyat and Atlantic Union
Can any of the company-specific risk be diversified away by investing in both Bank Rakyat and Atlantic Union 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 Atlantic Union into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Rakyat and Atlantic Union Bankshares, you can compare the effects of market volatilities on Bank Rakyat and Atlantic Union 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 Atlantic Union. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Rakyat and Atlantic Union.
Diversification Opportunities for Bank Rakyat and Atlantic Union
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and Atlantic is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Bank Rakyat and Atlantic Union Bankshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlantic Union Bankshares 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 Atlantic Union. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlantic Union Bankshares has no effect on the direction of Bank Rakyat i.e., Bank Rakyat and Atlantic Union go up and down completely randomly.
Pair Corralation between Bank Rakyat and Atlantic Union
Assuming the 90 days horizon Bank Rakyat is expected to under-perform the Atlantic Union. In addition to that, Bank Rakyat is 1.35 times more volatile than Atlantic Union Bankshares. It trades about -0.04 of its total potential returns per unit of risk. Atlantic Union Bankshares is currently generating about 0.1 per unit of volatility. If you would invest 1,872 in Atlantic Union Bankshares on September 4, 2024 and sell it today you would earn a total of 638.00 from holding Atlantic Union Bankshares or generate 34.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Rakyat vs. Atlantic Union Bankshares
Performance |
| Timeline |
| Bank Rakyat |
| Atlantic Union Bankshares |
Bank Rakyat and Atlantic Union Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Rakyat and Atlantic Union
The main advantage of trading using opposite Bank Rakyat and Atlantic Union positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Rakyat position performs unexpectedly, Atlantic Union 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 Atlantic Union will offset losses from the drop in Atlantic Union's long position.| Bank Rakyat vs. Bank Mandiri Persero | Bank Rakyat vs. Eurobank Ergasias Services | Bank Rakyat vs. Nedbank Group | Bank Rakyat vs. Standard Bank Group |
| Atlantic Union vs. Sabre Corpo | Atlantic Union vs. Accel Entertainment | Atlantic Union vs. Kura Sushi USA | Atlantic Union vs. RCI Hospitality Holdings |
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 Stocks Directory module to find actively traded stocks across global markets.
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