Correlation Between PT Bank and HEIA
Can any of the company-specific risk be diversified away by investing in both PT Bank and HEIA 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 PT Bank and HEIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Bank Maybank and HEIA, you can compare the effects of market volatilities on PT Bank and HEIA 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 PT Bank with a short position of HEIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and HEIA.
Diversification Opportunities for PT Bank and HEIA
Excellent diversification
The 3 months correlation between BOZA and HEIA is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Maybank and HEIA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HEIA and PT Bank 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 PT Bank Maybank are associated (or correlated) with HEIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HEIA has no effect on the direction of PT Bank i.e., PT Bank and HEIA go up and down completely randomly.
Pair Corralation between PT Bank and HEIA
If you would invest 1.25 in PT Bank Maybank on August 29, 2024 and sell it today you would earn a total of 0.05 from holding PT Bank Maybank or generate 4.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
PT Bank Maybank vs. HEIA
Performance |
| Timeline |
| PT Bank Maybank |
| HEIA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
PT Bank and HEIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and HEIA
The main advantage of trading using opposite PT Bank and HEIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, HEIA 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 HEIA will offset losses from the drop in HEIA's long position.| PT Bank vs. Stewart Information Services | PT Bank vs. MOVIE GAMES SA | PT Bank vs. UNIVMUSIC GRPADR050 | PT Bank vs. DATAGROUP SE |
| HEIA vs. Merit Medical Systems | HEIA vs. Apollo Medical Holdings | HEIA vs. MEDICAL FACILITIES NEW | HEIA vs. SBM OFFSHORE |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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