Correlation Between PT Barito and Zurich Insurance
Can any of the company-specific risk be diversified away by investing in both PT Barito and Zurich Insurance 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 Barito and Zurich Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Barito Pacific and Zurich Insurance Group, you can compare the effects of market volatilities on PT Barito and Zurich Insurance 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 Barito with a short position of Zurich Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Barito and Zurich Insurance.
Diversification Opportunities for PT Barito and Zurich Insurance
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between OB8 and Zurich is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding PT Barito Pacific and Zurich Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zurich Insurance and PT Barito 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 Barito Pacific are associated (or correlated) with Zurich Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zurich Insurance has no effect on the direction of PT Barito i.e., PT Barito and Zurich Insurance go up and down completely randomly.
Pair Corralation between PT Barito and Zurich Insurance
Assuming the 90 days horizon PT Barito is expected to generate 1.04 times less return on investment than Zurich Insurance. In addition to that, PT Barito is 4.61 times more volatile than Zurich Insurance Group. It trades about 0.02 of its total potential returns per unit of risk. Zurich Insurance Group is currently generating about 0.08 per unit of volatility. If you would invest 2,185 in Zurich Insurance Group on August 25, 2024 and sell it today you would earn a total of 695.00 from holding Zurich Insurance Group or generate 31.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Barito Pacific vs. Zurich Insurance Group
Performance |
| Timeline |
| PT Barito Pacific |
| Zurich Insurance |
PT Barito and Zurich Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Barito and Zurich Insurance
The main advantage of trading using opposite PT Barito and Zurich Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Barito position performs unexpectedly, Zurich Insurance 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 Zurich Insurance will offset losses from the drop in Zurich Insurance's long position.| PT Barito vs. QBE Insurance Group | PT Barito vs. 24SEVENOFFICE GROUP AB | PT Barito vs. CENTURIA OFFICE REIT | PT Barito vs. REVO INSURANCE SPA |
| Zurich Insurance vs. Perseus Mining Limited | Zurich Insurance vs. INDOFOOD AGRI RES | Zurich Insurance vs. Performance Food Group | Zurich Insurance vs. TYSON FOODS A |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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