Correlation Between Comerica and PT Bank
Can any of the company-specific risk be diversified away by investing in both Comerica and PT Bank 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 Comerica and PT Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Comerica and PT Bank Rakyat, you can compare the effects of market volatilities on Comerica and PT Bank 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 Comerica with a short position of PT Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Comerica and PT Bank.
Diversification Opportunities for Comerica and PT Bank
Pay attention - limited upside
The 3 months correlation between Comerica and BKRKF is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Comerica and PT Bank Rakyat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Bank Rakyat and Comerica 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 Comerica are associated (or correlated) with PT Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Bank Rakyat has no effect on the direction of Comerica i.e., Comerica and PT Bank go up and down completely randomly.
Pair Corralation between Comerica and PT Bank
Considering the 90-day investment horizon Comerica is expected to generate 0.42 times more return on investment than PT Bank. However, Comerica is 2.36 times less risky than PT Bank. It trades about 0.23 of its potential returns per unit of risk. PT Bank Rakyat is currently generating about -0.08 per unit of risk. If you would invest 6,239 in Comerica on September 4, 2024 and sell it today you would earn a total of 841.00 from holding Comerica or generate 13.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Comerica vs. PT Bank Rakyat
Performance |
| Timeline |
| Comerica |
| PT Bank Rakyat |
Comerica and PT Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Comerica and PT Bank
The main advantage of trading using opposite Comerica and PT Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Comerica position performs unexpectedly, PT Bank 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 PT Bank will offset losses from the drop in PT Bank's long position.| Comerica vs. International Bancshares | Comerica vs. Finward Bancorp | Comerica vs. Aquagold International | Comerica vs. Thrivent High Yield |
| PT Bank vs. First Hawaiian | PT Bank vs. Central Pacific Financial | PT Bank vs. Territorial Bancorp | PT Bank vs. Comerica |
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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