Correlation Between Bank Rakyat and ViewRay
Can any of the company-specific risk be diversified away by investing in both Bank Rakyat and ViewRay 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 ViewRay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Rakyat and ViewRay, you can compare the effects of market volatilities on Bank Rakyat and ViewRay 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 ViewRay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Rakyat and ViewRay.
Diversification Opportunities for Bank Rakyat and ViewRay
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and ViewRay is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Bank Rakyat and ViewRay in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ViewRay 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 ViewRay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ViewRay has no effect on the direction of Bank Rakyat i.e., Bank Rakyat and ViewRay go up and down completely randomly.
Pair Corralation between Bank Rakyat and ViewRay
Assuming the 90 days horizon Bank Rakyat is expected to generate 0.17 times more return on investment than ViewRay. However, Bank Rakyat is 5.82 times less risky than ViewRay. It trades about 0.0 of its potential returns per unit of risk. ViewRay is currently generating about -0.23 per unit of risk. If you would invest 1,434 in Bank Rakyat on September 3, 2024 and sell it today you would lose (88.00) from holding Bank Rakyat or give up 6.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 30.91% |
| Values | Daily Returns |
Bank Rakyat vs. ViewRay
Performance |
| Timeline |
| Bank Rakyat |
| ViewRay |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Bank Rakyat and ViewRay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Rakyat and ViewRay
The main advantage of trading using opposite Bank Rakyat and ViewRay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Rakyat position performs unexpectedly, ViewRay 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 ViewRay will offset losses from the drop in ViewRay'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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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