Correlation Between PT Bank and AdvanSix
Can any of the company-specific risk be diversified away by investing in both PT Bank and AdvanSix 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 AdvanSix 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 AdvanSix, you can compare the effects of market volatilities on PT Bank and AdvanSix 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 AdvanSix. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and AdvanSix.
Diversification Opportunities for PT Bank and AdvanSix
Excellent diversification
The 3 months correlation between BYRA and AdvanSix is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and AdvanSix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AdvanSix 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 AdvanSix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AdvanSix has no effect on the direction of PT Bank i.e., PT Bank and AdvanSix go up and down completely randomly.
Pair Corralation between PT Bank and AdvanSix
Assuming the 90 days trading horizon PT Bank Rakyat is expected to generate 3.85 times more return on investment than AdvanSix. However, PT Bank is 3.85 times more volatile than AdvanSix. It trades about 0.08 of its potential returns per unit of risk. AdvanSix is currently generating about 0.07 per unit of risk. If you would invest 25.00 in PT Bank Rakyat on September 13, 2024 and sell it today you would earn a total of 2.00 from holding PT Bank Rakyat or generate 8.0% 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. AdvanSix
Performance |
| Timeline |
| PT Bank Rakyat |
| AdvanSix |
PT Bank and AdvanSix Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and AdvanSix
The main advantage of trading using opposite PT Bank and AdvanSix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, AdvanSix 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 AdvanSix will offset losses from the drop in AdvanSix's long position.| PT Bank vs. AWILCO DRILLING PLC | PT Bank vs. BORR DRILLING NEW | PT Bank vs. USWE SPORTS AB | PT Bank vs. DISTRICT METALS |
| AdvanSix vs. AGF Management Limited | AdvanSix vs. Platinum Investment Management | AdvanSix vs. MARKET VECTR RETAIL | AdvanSix vs. Ross Stores |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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