Correlation Between Banpu PCL and Alta Equipment
Can any of the company-specific risk be diversified away by investing in both Banpu PCL and Alta Equipment 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 Banpu PCL and Alta Equipment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banpu PCL ADR and Alta Equipment Group, you can compare the effects of market volatilities on Banpu PCL and Alta Equipment 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 Banpu PCL with a short position of Alta Equipment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banpu PCL and Alta Equipment.
Diversification Opportunities for Banpu PCL and Alta Equipment
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Banpu and Alta is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Banpu PCL ADR and Alta Equipment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alta Equipment Group and Banpu PCL 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 Banpu PCL ADR are associated (or correlated) with Alta Equipment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alta Equipment Group has no effect on the direction of Banpu PCL i.e., Banpu PCL and Alta Equipment go up and down completely randomly.
Pair Corralation between Banpu PCL and Alta Equipment
Assuming the 90 days horizon Banpu PCL ADR is expected to generate 2.56 times more return on investment than Alta Equipment. However, Banpu PCL is 2.56 times more volatile than Alta Equipment Group. It trades about 0.0 of its potential returns per unit of risk. Alta Equipment Group is currently generating about -0.02 per unit of risk. If you would invest 389.00 in Banpu PCL ADR on September 12, 2024 and sell it today you would lose (192.00) from holding Banpu PCL ADR or give up 49.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 47.98% |
| Values | Daily Returns |
Banpu PCL ADR vs. Alta Equipment Group
Performance |
| Timeline |
| Banpu PCL ADR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Alta Equipment Group |
Banpu PCL and Alta Equipment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banpu PCL and Alta Equipment
The main advantage of trading using opposite Banpu PCL and Alta Equipment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banpu PCL position performs unexpectedly, Alta Equipment 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 Alta Equipment will offset losses from the drop in Alta Equipment's long position.| Banpu PCL vs. Cedar Realty Trust | Banpu PCL vs. Arrow Financial | Banpu PCL vs. Siriuspoint | Banpu PCL vs. Glacier Bancorp |
| Alta Equipment vs. PROG Holdings | Alta Equipment vs. GATX Corporation | Alta Equipment vs. McGrath RentCorp | Alta Equipment vs. Custom Truck One |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |