Correlation Between Fair Isaac and BANK RAKYAT
Can any of the company-specific risk be diversified away by investing in both Fair Isaac and BANK RAKYAT 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 Fair Isaac and BANK RAKYAT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fair Isaac Corp and BANK RAKYAT IND, you can compare the effects of market volatilities on Fair Isaac and BANK RAKYAT 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 Fair Isaac with a short position of BANK RAKYAT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fair Isaac and BANK RAKYAT.
Diversification Opportunities for Fair Isaac and BANK RAKYAT
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Fair and BANK is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Fair Isaac Corp and BANK RAKYAT IND in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANK RAKYAT IND and Fair Isaac 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 Fair Isaac Corp are associated (or correlated) with BANK RAKYAT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANK RAKYAT IND has no effect on the direction of Fair Isaac i.e., Fair Isaac and BANK RAKYAT go up and down completely randomly.
Pair Corralation between Fair Isaac and BANK RAKYAT
Assuming the 90 days trading horizon Fair Isaac Corp is expected to under-perform the BANK RAKYAT. But the stock apears to be less risky and, when comparing its historical volatility, Fair Isaac Corp is 1.32 times less risky than BANK RAKYAT. The stock trades about -0.42 of its potential returns per unit of risk. The BANK RAKYAT IND is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 24.00 in BANK RAKYAT IND on October 9, 2024 and sell it today you would lose (1.00) from holding BANK RAKYAT IND or give up 4.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fair Isaac Corp vs. BANK RAKYAT IND
Performance |
| Timeline |
| Fair Isaac Corp |
| BANK RAKYAT IND |
Fair Isaac and BANK RAKYAT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fair Isaac and BANK RAKYAT
The main advantage of trading using opposite Fair Isaac and BANK RAKYAT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fair Isaac position performs unexpectedly, BANK RAKYAT 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 BANK RAKYAT will offset losses from the drop in BANK RAKYAT's long position.| Fair Isaac vs. Yuexiu Transport Infrastructure | Fair Isaac vs. Air Transport Services | Fair Isaac vs. Fortescue Metals Group | Fair Isaac vs. ARDAGH METAL PACDL 0001 |
| BANK RAKYAT vs. Universal Insurance Holdings | BANK RAKYAT vs. CLOVER HEALTH INV | BANK RAKYAT vs. SBI Insurance Group | BANK RAKYAT vs. QBE Insurance Group |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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