Correlation Between PT Bank and Reinsurance Group
Can any of the company-specific risk be diversified away by investing in both PT Bank and Reinsurance Group 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 Reinsurance Group 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 Reinsurance Group of, you can compare the effects of market volatilities on PT Bank and Reinsurance Group 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 Reinsurance Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Reinsurance Group.
Diversification Opportunities for PT Bank and Reinsurance Group
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BOZA and Reinsurance is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Maybank and Reinsurance Group of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Reinsurance Group 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 Reinsurance Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Reinsurance Group has no effect on the direction of PT Bank i.e., PT Bank and Reinsurance Group go up and down completely randomly.
Pair Corralation between PT Bank and Reinsurance Group
Assuming the 90 days trading horizon PT Bank is expected to generate 50.84 times less return on investment than Reinsurance Group. In addition to that, PT Bank is 2.86 times more volatile than Reinsurance Group of. It trades about 0.0 of its total potential returns per unit of risk. Reinsurance Group of is currently generating about 0.12 per unit of volatility. If you would invest 12,484 in Reinsurance Group of on August 29, 2024 and sell it today you would earn a total of 9,516 from holding Reinsurance Group of or generate 76.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bank Maybank vs. Reinsurance Group of
Performance |
| Timeline |
| PT Bank Maybank |
| Reinsurance Group |
PT Bank and Reinsurance Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Reinsurance Group
The main advantage of trading using opposite PT Bank and Reinsurance Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Reinsurance Group 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 Reinsurance Group will offset losses from the drop in Reinsurance Group'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 |
| Reinsurance Group vs. Datadog | Reinsurance Group vs. PARKEN Sport Entertainment | Reinsurance Group vs. TERADATA | Reinsurance Group vs. GREENX METALS LTD |
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 Stocks Directory module to find actively traded stocks across global markets.
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