Correlation Between Bank Qnb and Bank Sinarmas
Can any of the company-specific risk be diversified away by investing in both Bank Qnb and Bank Sinarmas 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 Qnb and Bank Sinarmas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Qnb Indonesia and Bank Sinarmas Tbk, you can compare the effects of market volatilities on Bank Qnb and Bank Sinarmas 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 Qnb with a short position of Bank Sinarmas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Qnb and Bank Sinarmas.
Diversification Opportunities for Bank Qnb and Bank Sinarmas
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and Bank is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Bank Qnb Indonesia and Bank Sinarmas Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Sinarmas Tbk and Bank Qnb 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 Qnb Indonesia are associated (or correlated) with Bank Sinarmas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Sinarmas Tbk has no effect on the direction of Bank Qnb i.e., Bank Qnb and Bank Sinarmas go up and down completely randomly.
Pair Corralation between Bank Qnb and Bank Sinarmas
Assuming the 90 days trading horizon Bank Qnb Indonesia is expected to generate 3.75 times more return on investment than Bank Sinarmas. However, Bank Qnb is 3.75 times more volatile than Bank Sinarmas Tbk. It trades about 0.02 of its potential returns per unit of risk. Bank Sinarmas Tbk is currently generating about -0.19 per unit of risk. If you would invest 8,900 in Bank Qnb Indonesia on September 1, 2024 and sell it today you would lose (300.00) from holding Bank Qnb Indonesia or give up 3.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Bank Qnb Indonesia vs. Bank Sinarmas Tbk
Performance |
| Timeline |
| Bank Qnb Indonesia |
| Bank Sinarmas Tbk |
Bank Qnb and Bank Sinarmas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Qnb and Bank Sinarmas
The main advantage of trading using opposite Bank Qnb and Bank Sinarmas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Qnb position performs unexpectedly, Bank Sinarmas 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 Bank Sinarmas will offset losses from the drop in Bank Sinarmas' long position.| Bank Qnb vs. Bank Victoria International | Bank Qnb vs. Bank Mnc Internasional | Bank Qnb vs. Bank Bumi Arta | Bank Qnb vs. Bank Capital Indonesia |
| Bank Sinarmas vs. Bank Tabungan Pensiunan | Bank Sinarmas vs. Bank Bumi Arta | Bank Sinarmas vs. Bank Permata Tbk | Bank Sinarmas vs. Bank Victoria International |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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