Correlation Between Bank Ocbc and Era Media
Can any of the company-specific risk be diversified away by investing in both Bank Ocbc and Era Media 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 Ocbc and Era Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Ocbc Nisp and Era Media Sejahtera, you can compare the effects of market volatilities on Bank Ocbc and Era Media 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 Ocbc with a short position of Era Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Ocbc and Era Media.
Diversification Opportunities for Bank Ocbc and Era Media
Good diversification
The 3 months correlation between Bank and Era is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Bank Ocbc Nisp and Era Media Sejahtera in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Era Media Sejahtera and Bank Ocbc 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 Ocbc Nisp are associated (or correlated) with Era Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Era Media Sejahtera has no effect on the direction of Bank Ocbc i.e., Bank Ocbc and Era Media go up and down completely randomly.
Pair Corralation between Bank Ocbc and Era Media
Assuming the 90 days trading horizon Bank Ocbc is expected to generate 2.11 times less return on investment than Era Media. But when comparing it to its historical volatility, Bank Ocbc Nisp is 3.68 times less risky than Era Media. It trades about 0.05 of its potential returns per unit of risk. Era Media Sejahtera is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 5,100 in Era Media Sejahtera on September 2, 2024 and sell it today you would earn a total of 400.00 from holding Era Media Sejahtera or generate 7.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Ocbc Nisp vs. Era Media Sejahtera
Performance |
| Timeline |
| Bank Ocbc Nisp |
| Era Media Sejahtera |
Bank Ocbc and Era Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Ocbc and Era Media
The main advantage of trading using opposite Bank Ocbc and Era Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Ocbc position performs unexpectedly, Era Media 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 Era Media will offset losses from the drop in Era Media's long position.| Bank Ocbc vs. Bank BRISyariah Tbk | Bank Ocbc vs. Ace Hardware Indonesia | Bank Ocbc vs. Merdeka Copper Gold | Bank Ocbc vs. Mitra Pinasthika Mustika |
| Era Media vs. Bank Central Asia | Era Media vs. Bank Rakyat Indonesia | Era Media vs. Bayan Resources Tbk | Era Media vs. Bank Mandiri Persero |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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