Correlation Between Bank Victoria and Bank Qnb
Can any of the company-specific risk be diversified away by investing in both Bank Victoria and Bank Qnb 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 Victoria and Bank Qnb into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Victoria International and Bank Qnb Indonesia, you can compare the effects of market volatilities on Bank Victoria and Bank Qnb 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 Victoria with a short position of Bank Qnb. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Victoria and Bank Qnb.
Diversification Opportunities for Bank Victoria and Bank Qnb
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bank and Bank is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Bank Victoria International and Bank Qnb Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Qnb Indonesia and Bank Victoria 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 Victoria International are associated (or correlated) with Bank Qnb. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Qnb Indonesia has no effect on the direction of Bank Victoria i.e., Bank Victoria and Bank Qnb go up and down completely randomly.
Pair Corralation between Bank Victoria and Bank Qnb
Assuming the 90 days trading horizon Bank Victoria International is expected to generate 0.8 times more return on investment than Bank Qnb. However, Bank Victoria International is 1.25 times less risky than Bank Qnb. It trades about -0.02 of its potential returns per unit of risk. Bank Qnb Indonesia is currently generating about -0.04 per unit of risk. If you would invest 10,400 in Bank Victoria International on August 24, 2024 and sell it today you would lose (300.00) from holding Bank Victoria International or give up 2.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Victoria International vs. Bank Qnb Indonesia
Performance |
| Timeline |
| Bank Victoria Intern |
| Bank Qnb Indonesia |
Bank Victoria and Bank Qnb Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Victoria and Bank Qnb
The main advantage of trading using opposite Bank Victoria and Bank Qnb positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Victoria position performs unexpectedly, Bank Qnb 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 Bank Qnb will offset losses from the drop in Bank Qnb's long position.| Bank Victoria vs. Paninvest Tbk | Bank Victoria vs. Maskapai Reasuransi Indonesia | Bank Victoria vs. Panin Sekuritas Tbk | Bank Victoria vs. Wahana Ottomitra Multiartha |
| Bank Qnb vs. Paninvest Tbk | Bank Qnb vs. Maskapai Reasuransi Indonesia | Bank Qnb vs. Panin Sekuritas Tbk | Bank Qnb vs. Wahana Ottomitra Multiartha |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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