Correlation Between BANK RAKYAT and CyberAgent
Can any of the company-specific risk be diversified away by investing in both BANK RAKYAT and CyberAgent 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 RAKYAT and CyberAgent into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BANK RAKYAT IND and CyberAgent, you can compare the effects of market volatilities on BANK RAKYAT and CyberAgent 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 RAKYAT with a short position of CyberAgent. Check out your portfolio center. Please also check ongoing floating volatility patterns of BANK RAKYAT and CyberAgent.
Diversification Opportunities for BANK RAKYAT and CyberAgent
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BANK and CyberAgent is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding BANK RAKYAT IND and CyberAgent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CyberAgent and BANK RAKYAT 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 RAKYAT IND are associated (or correlated) with CyberAgent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CyberAgent has no effect on the direction of BANK RAKYAT i.e., BANK RAKYAT and CyberAgent go up and down completely randomly.
Pair Corralation between BANK RAKYAT and CyberAgent
Assuming the 90 days trading horizon BANK RAKYAT IND is expected to under-perform the CyberAgent. In addition to that, BANK RAKYAT is 1.36 times more volatile than CyberAgent. It trades about -0.14 of its total potential returns per unit of risk. CyberAgent is currently generating about 0.23 per unit of volatility. If you would invest 590.00 in CyberAgent on August 31, 2024 and sell it today you would earn a total of 55.00 from holding CyberAgent or generate 9.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BANK RAKYAT IND vs. CyberAgent
Performance |
| Timeline |
| BANK RAKYAT IND |
| CyberAgent |
BANK RAKYAT and CyberAgent Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BANK RAKYAT and CyberAgent
The main advantage of trading using opposite BANK RAKYAT and CyberAgent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BANK RAKYAT position performs unexpectedly, CyberAgent 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 CyberAgent will offset losses from the drop in CyberAgent's long position.| BANK RAKYAT vs. Compugroup Medical SE | BANK RAKYAT vs. Japan Medical Dynamic | BANK RAKYAT vs. DOCDATA | BANK RAKYAT vs. National Storage Affiliates |
| CyberAgent vs. Publicis Groupe SA | CyberAgent vs. WPP PLC | CyberAgent vs. WPP PLC ADR | CyberAgent vs. Superior Plus Corp |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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