Correlation Between Bank BRISyariah and Maming Enam
Can any of the company-specific risk be diversified away by investing in both Bank BRISyariah and Maming Enam 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 BRISyariah and Maming Enam into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank BRISyariah Tbk and Maming Enam Sembilan, you can compare the effects of market volatilities on Bank BRISyariah and Maming Enam 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 BRISyariah with a short position of Maming Enam. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank BRISyariah and Maming Enam.
Diversification Opportunities for Bank BRISyariah and Maming Enam
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and Maming is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Bank BRISyariah Tbk and Maming Enam Sembilan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maming Enam Sembilan and Bank BRISyariah 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 BRISyariah Tbk are associated (or correlated) with Maming Enam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maming Enam Sembilan has no effect on the direction of Bank BRISyariah i.e., Bank BRISyariah and Maming Enam go up and down completely randomly.
Pair Corralation between Bank BRISyariah and Maming Enam
Assuming the 90 days trading horizon Bank BRISyariah Tbk is expected to generate 0.73 times more return on investment than Maming Enam. However, Bank BRISyariah Tbk is 1.37 times less risky than Maming Enam. It trades about -0.02 of its potential returns per unit of risk. Maming Enam Sembilan is currently generating about -0.38 per unit of risk. If you would invest 295,000 in Bank BRISyariah Tbk on September 2, 2024 and sell it today you would lose (5,000) from holding Bank BRISyariah Tbk or give up 1.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank BRISyariah Tbk vs. Maming Enam Sembilan
Performance |
| Timeline |
| Bank BRISyariah Tbk |
| Maming Enam Sembilan |
Bank BRISyariah and Maming Enam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank BRISyariah and Maming Enam
The main advantage of trading using opposite Bank BRISyariah and Maming Enam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank BRISyariah position performs unexpectedly, Maming Enam 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 Maming Enam will offset losses from the drop in Maming Enam's long position.| Bank BRISyariah vs. Ace Hardware Indonesia | Bank BRISyariah vs. Merdeka Copper Gold | Bank BRISyariah vs. Mitra Pinasthika Mustika | Bank BRISyariah vs. Jakarta Int Hotels |
| Maming Enam vs. HK Metals Utama | Maming Enam vs. Galva Technologies Tbk | Maming Enam vs. Trinitan Metals and | Maming Enam vs. Merdeka Copper Gold |
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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