Correlation Between Bank Rakyat and PlantFuel Life
Can any of the company-specific risk be diversified away by investing in both Bank Rakyat and PlantFuel Life 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 PlantFuel Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Rakyat and PlantFuel Life, you can compare the effects of market volatilities on Bank Rakyat and PlantFuel Life 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 PlantFuel Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Rakyat and PlantFuel Life.
Diversification Opportunities for Bank Rakyat and PlantFuel Life
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and PlantFuel is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Bank Rakyat and PlantFuel Life in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PlantFuel Life 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 PlantFuel Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PlantFuel Life has no effect on the direction of Bank Rakyat i.e., Bank Rakyat and PlantFuel Life go up and down completely randomly.
Pair Corralation between Bank Rakyat and PlantFuel Life
Assuming the 90 days horizon Bank Rakyat is expected to under-perform the PlantFuel Life. But the pink sheet apears to be less risky and, when comparing its historical volatility, Bank Rakyat is 46.88 times less risky than PlantFuel Life. The pink sheet trades about -0.28 of its potential returns per unit of risk. The PlantFuel Life is currently generating about 0.39 of returns per unit of risk over similar time horizon. If you would invest 0.07 in PlantFuel Life on September 2, 2024 and sell it today you would earn a total of 0.93 from holding PlantFuel Life or generate 1328.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Bank Rakyat vs. PlantFuel Life
Performance |
| Timeline |
| Bank Rakyat |
| PlantFuel Life |
Bank Rakyat and PlantFuel Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Rakyat and PlantFuel Life
The main advantage of trading using opposite Bank Rakyat and PlantFuel Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Rakyat position performs unexpectedly, PlantFuel Life 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 PlantFuel Life will offset losses from the drop in PlantFuel Life's long position.| Bank Rakyat vs. Piraeus Bank SA | Bank Rakyat vs. Turkiye Garanti Bankasi | Bank Rakyat vs. Uwharrie Capital Corp |
| PlantFuel Life vs. The A2 Milk | PlantFuel Life vs. Artisan Consumer Goods | PlantFuel Life vs. General Mills |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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