Correlation Between Bank Artha and Bank Pembangunan
Can any of the company-specific risk be diversified away by investing in both Bank Artha and Bank Pembangunan 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 Bank Artha and Bank Pembangunan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Artha Graha and Bank Pembangunan Daerah, you can compare the effects of market volatilities on Bank Artha and Bank Pembangunan 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 Bank Artha with a short position of Bank Pembangunan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Artha and Bank Pembangunan.
Diversification Opportunities for Bank Artha and Bank Pembangunan
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and Bank is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Bank Artha Graha and Bank Pembangunan Daerah in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Pembangunan Daerah and Bank Artha 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 Bank Artha Graha are associated (or correlated) with Bank Pembangunan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Pembangunan Daerah has no effect on the direction of Bank Artha i.e., Bank Artha and Bank Pembangunan go up and down completely randomly.
Pair Corralation between Bank Artha and Bank Pembangunan
Assuming the 90 days trading horizon Bank Artha Graha is expected to under-perform the Bank Pembangunan. In addition to that, Bank Artha is 3.56 times more volatile than Bank Pembangunan Daerah. It trades about -0.11 of its total potential returns per unit of risk. Bank Pembangunan Daerah is currently generating about -0.05 per unit of volatility. If you would invest 2,900 in Bank Pembangunan Daerah on October 24, 2024 and sell it today you would lose (100.00) from holding Bank Pembangunan Daerah or give up 3.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Bank Artha Graha vs. Bank Pembangunan Daerah
Performance |
| Timeline |
| Bank Artha Graha |
| Bank Pembangunan Daerah |
Bank Artha and Bank Pembangunan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Artha and Bank Pembangunan
The main advantage of trading using opposite Bank Artha and Bank Pembangunan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Artha position performs unexpectedly, Bank Pembangunan 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 Pembangunan will offset losses from the drop in Bank Pembangunan's long position.| Bank Artha vs. Bank Victoria International | Bank Artha vs. Bank Bumi Arta | Bank Artha vs. Bank Mnc Internasional | Bank Artha vs. Bank Qnb Indonesia |
| Bank Pembangunan vs. Bank Mnc Internasional | Bank Pembangunan vs. Bank Qnb Indonesia | Bank Pembangunan vs. Bank Victoria International | Bank Pembangunan vs. Bank Rakyat 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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