Correlation Between PT Bank and Tanger Factory
Can any of the company-specific risk be diversified away by investing in both PT Bank and Tanger Factory 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 Tanger Factory 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 Tanger Factory Outlet, you can compare the effects of market volatilities on PT Bank and Tanger Factory 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 Tanger Factory. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Tanger Factory.
Diversification Opportunities for PT Bank and Tanger Factory
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BYRA and Tanger is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Tanger Factory Outlet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tanger Factory Outlet 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 Tanger Factory. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tanger Factory Outlet has no effect on the direction of PT Bank i.e., PT Bank and Tanger Factory go up and down completely randomly.
Pair Corralation between PT Bank and Tanger Factory
Assuming the 90 days trading horizon PT Bank is expected to generate 1.62 times less return on investment than Tanger Factory. In addition to that, PT Bank is 3.9 times more volatile than Tanger Factory Outlet. It trades about 0.03 of its total potential returns per unit of risk. Tanger Factory Outlet is currently generating about 0.18 per unit of volatility. If you would invest 2,429 in Tanger Factory Outlet on August 29, 2024 and sell it today you would earn a total of 1,008 from holding Tanger Factory Outlet or generate 41.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bank Rakyat vs. Tanger Factory Outlet
Performance |
| Timeline |
| PT Bank Rakyat |
| Tanger Factory Outlet |
PT Bank and Tanger Factory Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Tanger Factory
The main advantage of trading using opposite PT Bank and Tanger Factory positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Tanger Factory 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 Tanger Factory will offset losses from the drop in Tanger Factory'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 |
| Tanger Factory vs. HomeToGo SE | Tanger Factory vs. Corporate Office Properties | Tanger Factory vs. PSI Software AG | Tanger Factory vs. American Homes 4 |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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