Correlation Between PT Bank and WINMARK
Can any of the company-specific risk be diversified away by investing in both PT Bank and WINMARK 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 WINMARK 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 WINMARK, you can compare the effects of market volatilities on PT Bank and WINMARK 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 WINMARK. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and WINMARK.
Diversification Opportunities for PT Bank and WINMARK
Pay attention - limited upside
The 3 months correlation between BYRA and WINMARK is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and WINMARK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WINMARK 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 WINMARK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WINMARK has no effect on the direction of PT Bank i.e., PT Bank and WINMARK go up and down completely randomly.
Pair Corralation between PT Bank and WINMARK
Assuming the 90 days trading horizon PT Bank Rakyat is expected to generate 3.11 times more return on investment than WINMARK. However, PT Bank is 3.11 times more volatile than WINMARK. It trades about 0.01 of its potential returns per unit of risk. WINMARK is currently generating about 0.0 per unit of risk. If you would invest 33.00 in PT Bank Rakyat on September 4, 2024 and sell it today you would lose (9.00) from holding PT Bank Rakyat or give up 27.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bank Rakyat vs. WINMARK
Performance |
| Timeline |
| PT Bank Rakyat |
| WINMARK |
PT Bank and WINMARK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and WINMARK
The main advantage of trading using opposite PT Bank and WINMARK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, WINMARK 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 WINMARK will offset losses from the drop in WINMARK's long position.| PT Bank vs. Hanison Construction Holdings | PT Bank vs. TITAN MACHINERY | PT Bank vs. Australian Agricultural | PT Bank vs. Southwest Airlines Co |
| WINMARK vs. SALESFORCE INC CDR | WINMARK vs. AOI Electronics Co | WINMARK vs. STORE ELECTRONIC | WINMARK vs. GungHo Online Entertainment |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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