Correlation Between PT Techno9 and Bank Rakyat
Can any of the company-specific risk be diversified away by investing in both PT Techno9 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 PT Techno9 and Bank Rakyat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Techno9 Indonesia and Bank Rakyat Indonesia, you can compare the effects of market volatilities on PT Techno9 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 PT Techno9 with a short position of Bank Rakyat. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Techno9 and Bank Rakyat.
Diversification Opportunities for PT Techno9 and Bank Rakyat
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between NINE and Bank is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding PT Techno9 Indonesia and Bank Rakyat Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Rakyat Indonesia and PT Techno9 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 PT Techno9 Indonesia 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 Indonesia has no effect on the direction of PT Techno9 i.e., PT Techno9 and Bank Rakyat go up and down completely randomly.
Pair Corralation between PT Techno9 and Bank Rakyat
Assuming the 90 days trading horizon PT Techno9 Indonesia is expected to generate 2.53 times more return on investment than Bank Rakyat. However, PT Techno9 is 2.53 times more volatile than Bank Rakyat Indonesia. It trades about 0.63 of its potential returns per unit of risk. Bank Rakyat Indonesia is currently generating about -0.11 per unit of risk. If you would invest 800.00 in PT Techno9 Indonesia on August 29, 2024 and sell it today you would earn a total of 2,800 from holding PT Techno9 Indonesia or generate 350.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Techno9 Indonesia vs. Bank Rakyat Indonesia
Performance |
| Timeline |
| PT Techno9 Indonesia |
| Bank Rakyat Indonesia |
PT Techno9 and Bank Rakyat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Techno9 and Bank Rakyat
The main advantage of trading using opposite PT Techno9 and Bank Rakyat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Techno9 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.| PT Techno9 vs. Ciptadana Asset Management | PT Techno9 vs. Humpuss Intermoda Transportasi | PT Techno9 vs. Metrodata Electronics Tbk | PT Techno9 vs. Indorama Synthetics Tbk |
| Bank Rakyat vs. Bank Bukopin Tbk | Bank Rakyat vs. Bank BRISyariah Tbk | Bank Rakyat vs. Bank Tabungan Negara | Bank Rakyat vs. Bank Artos 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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