Correlation Between PT Bank and DBS Group
Can any of the company-specific risk be diversified away by investing in both PT Bank and DBS 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 DBS 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 DBS Group Holdings, you can compare the effects of market volatilities on PT Bank and DBS 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 DBS Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and DBS Group.
Diversification Opportunities for PT Bank and DBS Group
Excellent diversification
The 3 months correlation between BYRA and DBS is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and DBS Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DBS 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 DBS Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DBS Group Holdings has no effect on the direction of PT Bank i.e., PT Bank and DBS Group go up and down completely randomly.
Pair Corralation between PT Bank and DBS Group
Assuming the 90 days trading horizon PT Bank Rakyat is expected to under-perform the DBS Group. In addition to that, PT Bank is 1.11 times more volatile than DBS Group Holdings. It trades about -0.2 of its total potential returns per unit of risk. DBS Group Holdings is currently generating about 0.19 per unit of volatility. If you would invest 2,700 in DBS Group Holdings on August 29, 2024 and sell it today you would earn a total of 245.00 from holding DBS Group Holdings or generate 9.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
PT Bank Rakyat vs. DBS Group Holdings
Performance |
| Timeline |
| PT Bank Rakyat |
| DBS Group Holdings |
PT Bank and DBS Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and DBS Group
The main advantage of trading using opposite PT Bank and DBS Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, DBS 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 DBS Group will offset losses from the drop in DBS Group's long position.| PT Bank vs. UNIVMUSIC GRPADR050 | PT Bank vs. VIVA WINE GROUP | PT Bank vs. ITALIAN WINE BRANDS | PT Bank vs. UNIVERSAL MUSIC GROUP |
| DBS Group vs. Cleanaway Waste Management | DBS Group vs. Pebblebrook Hotel Trust | DBS Group vs. COFCO Joycome Foods | DBS Group vs. Lifeway Foods |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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