Correlation Between Bank Rakyat and Voip Pal
Can any of the company-specific risk be diversified away by investing in both Bank Rakyat and Voip Pal 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 Voip Pal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Rakyat and Voip PalCom, you can compare the effects of market volatilities on Bank Rakyat and Voip Pal 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 Voip Pal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Rakyat and Voip Pal.
Diversification Opportunities for Bank Rakyat and Voip Pal
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and Voip is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Bank Rakyat and Voip PalCom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voip PalCom 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 Voip Pal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voip PalCom has no effect on the direction of Bank Rakyat i.e., Bank Rakyat and Voip Pal go up and down completely randomly.
Pair Corralation between Bank Rakyat and Voip Pal
Assuming the 90 days horizon Bank Rakyat is expected to under-perform the Voip Pal. But the pink sheet apears to be less risky and, when comparing its historical volatility, Bank Rakyat is 5.57 times less risky than Voip Pal. The pink sheet trades about -0.01 of its potential returns per unit of risk. The Voip PalCom is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 5.49 in Voip PalCom on November 27, 2024 and sell it today you would lose (4.43) from holding Voip PalCom or give up 80.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Bank Rakyat vs. Voip PalCom
Performance |
| Timeline |
| Bank Rakyat |
| Voip PalCom |
Bank Rakyat and Voip Pal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Rakyat and Voip Pal
The main advantage of trading using opposite Bank Rakyat and Voip Pal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Rakyat position performs unexpectedly, Voip Pal 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 Voip Pal will offset losses from the drop in Voip Pal'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 |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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