Correlation Between Bank Rakyat and AuQ Gold
Can any of the company-specific risk be diversified away by investing in both Bank Rakyat and AuQ Gold 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 AuQ Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Rakyat and AuQ Gold Mining, you can compare the effects of market volatilities on Bank Rakyat and AuQ Gold 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 AuQ Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Rakyat and AuQ Gold.
Diversification Opportunities for Bank Rakyat and AuQ Gold
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and AuQ is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Bank Rakyat and AuQ Gold Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AuQ Gold Mining 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 AuQ Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AuQ Gold Mining has no effect on the direction of Bank Rakyat i.e., Bank Rakyat and AuQ Gold go up and down completely randomly.
Pair Corralation between Bank Rakyat and AuQ Gold
Assuming the 90 days horizon Bank Rakyat is expected to generate 0.31 times more return on investment than AuQ Gold. However, Bank Rakyat is 3.23 times less risky than AuQ Gold. It trades about -0.09 of its potential returns per unit of risk. AuQ Gold Mining is currently generating about -0.3 per unit of risk. If you would invest 1,394 in Bank Rakyat on September 12, 2024 and sell it today you would lose (47.00) from holding Bank Rakyat or give up 3.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
Bank Rakyat vs. AuQ Gold Mining
Performance |
| Timeline |
| Bank Rakyat |
| AuQ Gold Mining |
Bank Rakyat and AuQ Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Rakyat and AuQ Gold
The main advantage of trading using opposite Bank Rakyat and AuQ Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Rakyat position performs unexpectedly, AuQ Gold 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 AuQ Gold will offset losses from the drop in AuQ Gold's long position.| Bank Rakyat vs. PT Bank Rakyat | Bank Rakyat vs. Morningstar Unconstrained Allocation | Bank Rakyat vs. Bondbloxx ETF Trust | Bank Rakyat vs. Spring Valley Acquisition |
| AuQ Gold vs. National CineMedia | AuQ Gold vs. Apogee Enterprises | AuQ Gold vs. Pinterest | AuQ Gold vs. Zedge Inc |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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