Correlation Between Bank BRISyariah and Bakrie Sumatera
Can any of the company-specific risk be diversified away by investing in both Bank BRISyariah and Bakrie Sumatera 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 Bakrie Sumatera 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 Bakrie Sumatera Plantations, you can compare the effects of market volatilities on Bank BRISyariah and Bakrie Sumatera 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 Bakrie Sumatera. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank BRISyariah and Bakrie Sumatera.
Diversification Opportunities for Bank BRISyariah and Bakrie Sumatera
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bank and Bakrie is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Bank BRISyariah Tbk and Bakrie Sumatera Plantations in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bakrie Sumatera Plan 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 Bakrie Sumatera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bakrie Sumatera Plan has no effect on the direction of Bank BRISyariah i.e., Bank BRISyariah and Bakrie Sumatera go up and down completely randomly.
Pair Corralation between Bank BRISyariah and Bakrie Sumatera
Assuming the 90 days trading horizon Bank BRISyariah is expected to generate 5.14 times less return on investment than Bakrie Sumatera. In addition to that, Bank BRISyariah is 1.16 times more volatile than Bakrie Sumatera Plantations. It trades about 0.03 of its total potential returns per unit of risk. Bakrie Sumatera Plantations is currently generating about 0.15 per unit of volatility. If you would invest 7,500 in Bakrie Sumatera Plantations on September 3, 2024 and sell it today you would earn a total of 4,200 from holding Bakrie Sumatera Plantations or generate 56.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank BRISyariah Tbk vs. Bakrie Sumatera Plantations
Performance |
| Timeline |
| Bank BRISyariah Tbk |
| Bakrie Sumatera Plan |
Bank BRISyariah and Bakrie Sumatera Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank BRISyariah and Bakrie Sumatera
The main advantage of trading using opposite Bank BRISyariah and Bakrie Sumatera positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank BRISyariah position performs unexpectedly, Bakrie Sumatera 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 Bakrie Sumatera will offset losses from the drop in Bakrie Sumatera's long position.| Bank BRISyariah vs. Aneka Tambang Persero | Bank BRISyariah vs. Sido Muncul PT | Bank BRISyariah vs. Indofood Cbp Sukses | Bank BRISyariah vs. Bank Tabungan Pensiunan |
| Bakrie Sumatera vs. Bakrieland Development Tbk | Bakrie Sumatera vs. Bakrie Brothers Tbk | Bakrie Sumatera vs. Energi Mega Persada | Bakrie Sumatera vs. Sampoerna Agro Tbk |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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