Correlation Between PT Bank and Hoist Finance
Can any of the company-specific risk be diversified away by investing in both PT Bank and Hoist Finance 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 PT Bank and Hoist Finance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Bank Rakyat and Hoist Finance AB, you can compare the effects of market volatilities on PT Bank and Hoist Finance 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 PT Bank with a short position of Hoist Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Hoist Finance.
Diversification Opportunities for PT Bank and Hoist Finance
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BYRA and Hoist is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Hoist Finance AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hoist Finance AB and PT Bank 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 PT Bank Rakyat are associated (or correlated) with Hoist Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hoist Finance AB has no effect on the direction of PT Bank i.e., PT Bank and Hoist Finance go up and down completely randomly.
Pair Corralation between PT Bank and Hoist Finance
Assuming the 90 days trading horizon PT Bank Rakyat is expected to under-perform the Hoist Finance. In addition to that, PT Bank is 1.5 times more volatile than Hoist Finance AB. It trades about -0.01 of its total potential returns per unit of risk. Hoist Finance AB is currently generating about 0.07 per unit of volatility. If you would invest 752.00 in Hoist Finance AB on October 14, 2024 and sell it today you would earn a total of 83.00 from holding Hoist Finance AB or generate 11.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bank Rakyat vs. Hoist Finance AB
Performance |
| Timeline |
| PT Bank Rakyat |
| Hoist Finance AB |
PT Bank and Hoist Finance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Hoist Finance
The main advantage of trading using opposite PT Bank and Hoist Finance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Hoist Finance 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 Hoist Finance will offset losses from the drop in Hoist Finance's long position.| PT Bank vs. Corsair Gaming | PT Bank vs. MCEWEN MINING INC | PT Bank vs. Altair Engineering | PT Bank vs. Zijin Mining Group |
| Hoist Finance vs. FIRST SAVINGS FINL | Hoist Finance vs. NetSol Technologies | Hoist Finance vs. Digilife Technologies Limited | Hoist Finance vs. CHRYSALIS INVESTMENTS LTD |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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