Correlation Between PT Bank and PT Bank
Can any of the company-specific risk be diversified away by investing in both PT Bank and PT Bank 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 PT Bank 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 PT Bank Rakyat, you can compare the effects of market volatilities on PT Bank and PT Bank 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 PT Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and PT Bank.
Diversification Opportunities for PT Bank and PT Bank
Poor diversification
The 3 months correlation between BYRA and BYRA is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and PT Bank Rakyat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Bank Rakyat 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 PT Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Bank Rakyat has no effect on the direction of PT Bank i.e., PT Bank and PT Bank go up and down completely randomly.
Pair Corralation between PT Bank and PT Bank
Assuming the 90 days trading horizon PT Bank Rakyat is expected to generate 1.47 times more return on investment than PT Bank. However, PT Bank is 1.47 times more volatile than PT Bank Rakyat. It trades about 0.03 of its potential returns per unit of risk. PT Bank Rakyat is currently generating about 0.02 per unit of risk. If you would invest 25.00 in PT Bank Rakyat on September 1, 2024 and sell it today you would earn a total of 0.00 from holding PT Bank Rakyat or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.24% |
| Values | Daily Returns |
PT Bank Rakyat vs. PT Bank Rakyat
Performance |
| Timeline |
| PT Bank Rakyat |
| PT Bank Rakyat |
PT Bank and PT Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and PT Bank
The main advantage of trading using opposite PT Bank and PT Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, PT Bank 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 PT Bank will offset losses from the drop in PT Bank's long position.The idea behind PT Bank Rakyat and PT Bank Rakyat pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| PT Bank vs. SCOTT TECHNOLOGY | PT Bank vs. GEAR4MUSIC LS 10 | PT Bank vs. DXC Technology Co | PT Bank vs. Warner Music Group |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |