Correlation Between TSOGO SUN and BANK RAKYAT
Can any of the company-specific risk be diversified away by investing in both TSOGO SUN 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 TSOGO SUN and BANK RAKYAT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TSOGO SUN GAMING and BANK RAKYAT IND, you can compare the effects of market volatilities on TSOGO SUN 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 TSOGO SUN with a short position of BANK RAKYAT. Check out your portfolio center. Please also check ongoing floating volatility patterns of TSOGO SUN and BANK RAKYAT.
Diversification Opportunities for TSOGO SUN and BANK RAKYAT
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between TSOGO and BANK is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding TSOGO SUN GAMING 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 TSOGO SUN 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 TSOGO SUN GAMING 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 TSOGO SUN i.e., TSOGO SUN and BANK RAKYAT go up and down completely randomly.
Pair Corralation between TSOGO SUN and BANK RAKYAT
Assuming the 90 days horizon TSOGO SUN GAMING is expected to under-perform the BANK RAKYAT. But the stock apears to be less risky and, when comparing its historical volatility, TSOGO SUN GAMING is 1.43 times less risky than BANK RAKYAT. The stock trades about -0.27 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 22.00 in BANK RAKYAT IND on October 20, 2024 and sell it today you would earn a total of 1.00 from holding BANK RAKYAT IND or generate 4.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TSOGO SUN GAMING vs. BANK RAKYAT IND
Performance |
| Timeline |
| TSOGO SUN GAMING |
| BANK RAKYAT IND |
TSOGO SUN and BANK RAKYAT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TSOGO SUN and BANK RAKYAT
The main advantage of trading using opposite TSOGO SUN and BANK RAKYAT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TSOGO SUN 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.| TSOGO SUN vs. Easy Software AG | TSOGO SUN vs. Methode Electronics | TSOGO SUN vs. GLG LIFE TECH | TSOGO SUN vs. Agilent Technologies |
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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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