Correlation Between PT Bank and Realord Group
Can any of the company-specific risk be diversified away by investing in both PT Bank and Realord Group 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 Realord Group 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 Realord Group Holdings, you can compare the effects of market volatilities on PT Bank and Realord Group 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 Realord Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Realord Group.
Diversification Opportunities for PT Bank and Realord Group
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BYRA and Realord is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Realord Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Realord Group Holdings 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 Realord Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Realord Group Holdings has no effect on the direction of PT Bank i.e., PT Bank and Realord Group go up and down completely randomly.
Pair Corralation between PT Bank and Realord Group
Assuming the 90 days trading horizon PT Bank Rakyat is expected to under-perform the Realord Group. In addition to that, PT Bank is 2.22 times more volatile than Realord Group Holdings. It trades about -0.04 of its total potential returns per unit of risk. Realord Group Holdings is currently generating about -0.07 per unit of volatility. If you would invest 88.00 in Realord Group Holdings on September 18, 2024 and sell it today you would lose (4.00) from holding Realord Group Holdings or give up 4.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
PT Bank Rakyat vs. Realord Group Holdings
Performance |
| Timeline |
| PT Bank Rakyat |
| Realord Group Holdings |
PT Bank and Realord Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Realord Group
The main advantage of trading using opposite PT Bank and Realord Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Realord Group 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 Realord Group will offset losses from the drop in Realord Group's long position.| PT Bank vs. China Merchants Bank | PT Bank vs. HDFC Bank Limited | PT Bank vs. ICICI Bank Limited | PT Bank vs. PT Bank Central |
| Realord Group vs. YOOMA WELLNESS INC | Realord Group vs. Iridium Communications | Realord Group vs. HEMISPHERE EGY | Realord Group vs. Natural Health Trends |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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