Correlation Between PT Bank and TRISTAR GOLD
Can any of the company-specific risk be diversified away by investing in both PT Bank and TRISTAR GOLD 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 TRISTAR GOLD 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 TRISTAR GOLD, you can compare the effects of market volatilities on PT Bank and TRISTAR GOLD 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 TRISTAR GOLD. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and TRISTAR GOLD.
Diversification Opportunities for PT Bank and TRISTAR GOLD
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BYRA and TRISTAR is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and TRISTAR GOLD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRISTAR GOLD 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 TRISTAR GOLD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRISTAR GOLD has no effect on the direction of PT Bank i.e., PT Bank and TRISTAR GOLD go up and down completely randomly.
Pair Corralation between PT Bank and TRISTAR GOLD
Assuming the 90 days trading horizon PT Bank Rakyat is expected to generate 7.87 times more return on investment than TRISTAR GOLD. However, PT Bank is 7.87 times more volatile than TRISTAR GOLD. It trades about 0.04 of its potential returns per unit of risk. TRISTAR GOLD is currently generating about 0.3 per unit of risk. If you would invest 23.00 in PT Bank Rakyat on November 4, 2024 and sell it today you would earn a total of 0.00 from holding PT Bank Rakyat or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bank Rakyat vs. TRISTAR GOLD
Performance |
| Timeline |
| PT Bank Rakyat |
| TRISTAR GOLD |
PT Bank and TRISTAR GOLD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and TRISTAR GOLD
The main advantage of trading using opposite PT Bank and TRISTAR GOLD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, TRISTAR GOLD 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 TRISTAR GOLD will offset losses from the drop in TRISTAR GOLD's long position.| PT Bank vs. Jacquet Metal Service | PT Bank vs. Zurich Insurance Group | PT Bank vs. Direct Line Insurance | PT Bank vs. DAIDO METAL TD |
| TRISTAR GOLD vs. Fukuyama Transporting Co | TRISTAR GOLD vs. Yuexiu Transport Infrastructure | TRISTAR GOLD vs. TITANIUM TRANSPORTGROUP | TRISTAR GOLD vs. AEGEAN AIRLINES |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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