Correlation Between PT Bank and Telecom Argentina
Can any of the company-specific risk be diversified away by investing in both PT Bank and Telecom Argentina 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 Telecom Argentina 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 Telecom Argentina SA, you can compare the effects of market volatilities on PT Bank and Telecom Argentina 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 Telecom Argentina. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Telecom Argentina.
Diversification Opportunities for PT Bank and Telecom Argentina
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BYRA and Telecom is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Telecom Argentina SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telecom Argentina 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 Telecom Argentina. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telecom Argentina has no effect on the direction of PT Bank i.e., PT Bank and Telecom Argentina go up and down completely randomly.
Pair Corralation between PT Bank and Telecom Argentina
Assuming the 90 days trading horizon PT Bank Rakyat is expected to generate 2.03 times more return on investment than Telecom Argentina. However, PT Bank is 2.03 times more volatile than Telecom Argentina SA. It trades about 0.07 of its potential returns per unit of risk. Telecom Argentina SA is currently generating about -0.14 per unit of risk. If you would invest 22.00 in PT Bank Rakyat on October 25, 2024 and sell it today you would earn a total of 1.00 from holding PT Bank Rakyat or generate 4.55% 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. Telecom Argentina SA
Performance |
| Timeline |
| PT Bank Rakyat |
| Telecom Argentina |
PT Bank and Telecom Argentina Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Telecom Argentina
The main advantage of trading using opposite PT Bank and Telecom Argentina positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Telecom Argentina 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 Telecom Argentina will offset losses from the drop in Telecom Argentina's long position.| PT Bank vs. Caseys General Stores | PT Bank vs. CHIBA BANK | PT Bank vs. UNIQA INSURANCE GR | PT Bank vs. H2O Retailing |
| Telecom Argentina vs. Agilent Technologies | Telecom Argentina vs. SIERRA METALS | Telecom Argentina vs. UNIVERSAL MUSIC GROUP | Telecom Argentina vs. DAIDO METAL TD |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |