Correlation Between BANK RAKYAT and Perusahaan Perseroan
Can any of the company-specific risk be diversified away by investing in both BANK RAKYAT and Perusahaan Perseroan 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 Perusahaan Perseroan 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 Perusahaan Perseroan PT, you can compare the effects of market volatilities on BANK RAKYAT and Perusahaan Perseroan 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 Perusahaan Perseroan. Check out your portfolio center. Please also check ongoing floating volatility patterns of BANK RAKYAT and Perusahaan Perseroan.
Diversification Opportunities for BANK RAKYAT and Perusahaan Perseroan
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between BANK and Perusahaan is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding BANK RAKYAT IND and Perusahaan Perseroan PT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perusahaan Perseroan 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 Perusahaan Perseroan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perusahaan Perseroan has no effect on the direction of BANK RAKYAT i.e., BANK RAKYAT and Perusahaan Perseroan go up and down completely randomly.
Pair Corralation between BANK RAKYAT and Perusahaan Perseroan
Assuming the 90 days trading horizon BANK RAKYAT IND is expected to generate 1.04 times more return on investment than Perusahaan Perseroan. However, BANK RAKYAT is 1.04 times more volatile than Perusahaan Perseroan PT. It trades about 0.01 of its potential returns per unit of risk. Perusahaan Perseroan PT is currently generating about 0.01 per unit of risk. If you would invest 24.00 in BANK RAKYAT IND on September 1, 2024 and sell it today you would earn a total of 0.00 from holding BANK RAKYAT IND or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
BANK RAKYAT IND vs. Perusahaan Perseroan PT
Performance |
| Timeline |
| BANK RAKYAT IND |
| Perusahaan Perseroan |
BANK RAKYAT and Perusahaan Perseroan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BANK RAKYAT and Perusahaan Perseroan
The main advantage of trading using opposite BANK RAKYAT and Perusahaan Perseroan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BANK RAKYAT position performs unexpectedly, Perusahaan Perseroan 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 Perusahaan Perseroan will offset losses from the drop in Perusahaan Perseroan's long position.| BANK RAKYAT vs. Grand Canyon Education | BANK RAKYAT vs. LG Display Co | BANK RAKYAT vs. Seven West Media | BANK RAKYAT vs. Laureate Education |
| Perusahaan Perseroan vs. ATT Inc | Perusahaan Perseroan vs. Deutsche Telekom AG | Perusahaan Perseroan vs. Superior Plus Corp | Perusahaan Perseroan vs. NMI Holdings |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |