Correlation Between PT Bank and CARDINAL HEALTH
Can any of the company-specific risk be diversified away by investing in both PT Bank and CARDINAL HEALTH 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 CARDINAL HEALTH 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 CARDINAL HEALTH, you can compare the effects of market volatilities on PT Bank and CARDINAL HEALTH 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 CARDINAL HEALTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and CARDINAL HEALTH.
Diversification Opportunities for PT Bank and CARDINAL HEALTH
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BYRA and CARDINAL is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and CARDINAL HEALTH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CARDINAL HEALTH 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 CARDINAL HEALTH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CARDINAL HEALTH has no effect on the direction of PT Bank i.e., PT Bank and CARDINAL HEALTH go up and down completely randomly.
Pair Corralation between PT Bank and CARDINAL HEALTH
Assuming the 90 days trading horizon PT Bank Rakyat is expected to generate 8.44 times more return on investment than CARDINAL HEALTH. However, PT Bank is 8.44 times more volatile than CARDINAL HEALTH. It trades about 0.2 of its potential returns per unit of risk. CARDINAL HEALTH is currently generating about 0.7 per unit of risk. If you would invest 23.00 in PT Bank Rakyat on October 25, 2024 and sell it today you would earn a total of 4.00 from holding PT Bank Rakyat or generate 17.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
PT Bank Rakyat vs. CARDINAL HEALTH
Performance |
| Timeline |
| PT Bank Rakyat |
| CARDINAL HEALTH |
PT Bank and CARDINAL HEALTH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and CARDINAL HEALTH
The main advantage of trading using opposite PT Bank and CARDINAL HEALTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, CARDINAL HEALTH 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 CARDINAL HEALTH will offset losses from the drop in CARDINAL HEALTH's long position.| PT Bank vs. CHIBA BANK | PT Bank vs. Scottish Mortgage Investment | PT Bank vs. AOYAMA TRADING | PT Bank vs. VIRGIN WINES UK |
| CARDINAL HEALTH vs. Zoom Video Communications | CARDINAL HEALTH vs. Planet Fitness | CARDINAL HEALTH vs. New Residential Investment | CARDINAL HEALTH vs. OPKO HEALTH |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |