Correlation Between Bank Qnb and Bank Victoria
Can any of the company-specific risk be diversified away by investing in both Bank Qnb and Bank Victoria 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 Victoria 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 Victoria International, you can compare the effects of market volatilities on Bank Qnb and Bank Victoria 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 Victoria. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Qnb and Bank Victoria.
Diversification Opportunities for Bank Qnb and Bank Victoria
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bank and Bank is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Bank Qnb Indonesia and Bank Victoria International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Victoria Intern 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 Victoria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Victoria Intern has no effect on the direction of Bank Qnb i.e., Bank Qnb and Bank Victoria go up and down completely randomly.
Pair Corralation between Bank Qnb and Bank Victoria
Assuming the 90 days trading horizon Bank Qnb Indonesia is expected to under-perform the Bank Victoria. In addition to that, Bank Qnb is 1.25 times more volatile than Bank Victoria International. It trades about -0.04 of its total potential returns per unit of risk. Bank Victoria International is currently generating about -0.02 per unit of volatility. If you would invest 10,400 in Bank Victoria International on August 24, 2024 and sell it today you would lose (300.00) from holding Bank Victoria International or give up 2.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Qnb Indonesia vs. Bank Victoria International
Performance |
| Timeline |
| Bank Qnb Indonesia |
| Bank Victoria Intern |
Bank Qnb and Bank Victoria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Qnb and Bank Victoria
The main advantage of trading using opposite Bank Qnb and Bank Victoria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Qnb position performs unexpectedly, Bank Victoria 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 Victoria will offset losses from the drop in Bank Victoria's long position.| Bank Qnb vs. Paninvest Tbk | Bank Qnb vs. Maskapai Reasuransi Indonesia | Bank Qnb vs. Panin Sekuritas Tbk | Bank Qnb vs. Wahana Ottomitra Multiartha |
| Bank Victoria vs. Paninvest Tbk | Bank Victoria vs. Maskapai Reasuransi Indonesia | Bank Victoria vs. Panin Sekuritas Tbk | Bank Victoria vs. Wahana Ottomitra Multiartha |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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