Correlation Between PT Bank and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both PT Bank and Goldman Sachs 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 Goldman Sachs 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 The Goldman Sachs, you can compare the effects of market volatilities on PT Bank and Goldman Sachs 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 Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Goldman Sachs.
Diversification Opportunities for PT Bank and Goldman Sachs
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BYRA and Goldman is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and The Goldman Sachs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs 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 Goldman Sachs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goldman Sachs has no effect on the direction of PT Bank i.e., PT Bank and Goldman Sachs go up and down completely randomly.
Pair Corralation between PT Bank and Goldman Sachs
Assuming the 90 days trading horizon PT Bank Rakyat is expected to under-perform the Goldman Sachs. But the stock apears to be less risky and, when comparing its historical volatility, PT Bank Rakyat is 1.48 times less risky than Goldman Sachs. The stock trades about -0.26 of its potential returns per unit of risk. The The Goldman Sachs is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 48,280 in The Goldman Sachs on August 25, 2024 and sell it today you would earn a total of 9,550 from holding The Goldman Sachs or generate 19.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bank Rakyat vs. The Goldman Sachs
Performance |
| Timeline |
| PT Bank Rakyat |
| Goldman Sachs |
PT Bank and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Goldman Sachs
The main advantage of trading using opposite PT Bank and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Goldman Sachs 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 Goldman Sachs will offset losses from the drop in Goldman Sachs' long position.| PT Bank vs. HDFC Bank Limited | PT Bank vs. PT Bank Central | PT Bank vs. DBS Group Holdings | PT Bank vs. State Bank of |
| Goldman Sachs vs. Macquarie Group Limited | Goldman Sachs vs. MSCI Inc | Goldman Sachs vs. Superior Plus Corp | Goldman Sachs vs. NMI Holdings |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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