Correlation Between PT Bank and Peabody Energy
Can any of the company-specific risk be diversified away by investing in both PT Bank and Peabody Energy 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 Peabody Energy 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 Peabody Energy, you can compare the effects of market volatilities on PT Bank and Peabody Energy 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 Peabody Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Peabody Energy.
Diversification Opportunities for PT Bank and Peabody Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BYRA and Peabody is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Peabody Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peabody Energy 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 Peabody Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peabody Energy has no effect on the direction of PT Bank i.e., PT Bank and Peabody Energy go up and down completely randomly.
Pair Corralation between PT Bank and Peabody Energy
If you would invest 32.00 in PT Bank Rakyat on September 1, 2024 and sell it today you would lose (7.00) from holding PT Bank Rakyat or give up 21.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
PT Bank Rakyat vs. Peabody Energy
Performance |
| Timeline |
| PT Bank Rakyat |
| Peabody Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
PT Bank and Peabody Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Peabody Energy
The main advantage of trading using opposite PT Bank and Peabody Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Peabody Energy 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 Peabody Energy will offset losses from the drop in Peabody Energy's long position.The idea behind PT Bank Rakyat and Peabody Energy pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Peabody Energy vs. SERI INDUSTRIAL EO | Peabody Energy vs. MUTUIONLINE | Peabody Energy vs. Evolution Mining Limited | Peabody Energy vs. Major Drilling Group |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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