Correlation Between Alphabet and PT Bank
Can any of the company-specific risk be diversified away by investing in both Alphabet 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 Alphabet and PT Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alphabet Inc Class C and PT Bank Bisnis, you can compare the effects of market volatilities on Alphabet 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 Alphabet with a short position of PT Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alphabet and PT Bank.
Diversification Opportunities for Alphabet and PT Bank
Good diversification
The 3 months correlation between Alphabet and BBSI is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Alphabet Inc Class C and PT Bank Bisnis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Bank Bisnis and Alphabet 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 Alphabet Inc Class C 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 Bisnis has no effect on the direction of Alphabet i.e., Alphabet and PT Bank go up and down completely randomly.
Pair Corralation between Alphabet and PT Bank
Given the investment horizon of 90 days Alphabet Inc Class C is expected to under-perform the PT Bank. In addition to that, Alphabet is 1.82 times more volatile than PT Bank Bisnis. It trades about -0.14 of its total potential returns per unit of risk. PT Bank Bisnis is currently generating about -0.06 per unit of volatility. If you would invest 416,000 in PT Bank Bisnis on November 27, 2024 and sell it today you would lose (6,000) from holding PT Bank Bisnis or give up 1.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.0% |
| Values | Daily Returns |
Alphabet Inc Class C vs. PT Bank Bisnis
Performance |
| Timeline |
| Alphabet Class C |
| PT Bank Bisnis |
Alphabet and PT Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alphabet and PT Bank
The main advantage of trading using opposite Alphabet and PT Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alphabet 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.The idea behind Alphabet Inc Class C and PT Bank Bisnis pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| PT Bank vs. Bk Harda Internasional | PT Bank vs. Bank Yudha Bhakti | PT Bank vs. Bank Net Indonesia | PT Bank vs. Bank Amar Indonesia |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |