Correlation Between Bank Permata and Teladan Prima
Can any of the company-specific risk be diversified away by investing in both Bank Permata and Teladan Prima 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 Permata and Teladan Prima into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Permata Tbk and Teladan Prima Agro, you can compare the effects of market volatilities on Bank Permata and Teladan Prima 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 Permata with a short position of Teladan Prima. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Permata and Teladan Prima.
Diversification Opportunities for Bank Permata and Teladan Prima
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and Teladan is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Bank Permata Tbk and Teladan Prima Agro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teladan Prima Agro and Bank Permata 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 Permata Tbk are associated (or correlated) with Teladan Prima. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teladan Prima Agro has no effect on the direction of Bank Permata i.e., Bank Permata and Teladan Prima go up and down completely randomly.
Pair Corralation between Bank Permata and Teladan Prima
Assuming the 90 days trading horizon Bank Permata Tbk is expected to generate 2.03 times more return on investment than Teladan Prima. However, Bank Permata is 2.03 times more volatile than Teladan Prima Agro. It trades about 0.01 of its potential returns per unit of risk. Teladan Prima Agro is currently generating about 0.0 per unit of risk. If you would invest 99,252 in Bank Permata Tbk on August 27, 2024 and sell it today you would earn a total of 1,748 from holding Bank Permata Tbk or generate 1.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Permata Tbk vs. Teladan Prima Agro
Performance |
| Timeline |
| Bank Permata Tbk |
| Teladan Prima Agro |
Bank Permata and Teladan Prima Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Permata and Teladan Prima
The main advantage of trading using opposite Bank Permata and Teladan Prima positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Permata position performs unexpectedly, Teladan Prima 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 Teladan Prima will offset losses from the drop in Teladan Prima's long position.| Bank Permata vs. Bank Cimb Niaga | Bank Permata vs. Bank Maybank Indonesia | Bank Permata vs. Bank Danamon Indonesia | Bank Permata vs. Bank Pan Indonesia |
| Teladan Prima vs. Sumber Tani Agung | Teladan Prima vs. Wir Asia Tbk | Teladan Prima vs. Triputra Agro Persada | Teladan Prima vs. Net Visi Media |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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