Correlation Between Optima Prima and Bank Ganesha
Can any of the company-specific risk be diversified away by investing in both Optima Prima and Bank Ganesha 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 Optima Prima and Bank Ganesha into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Optima Prima Metal and Bank Ganesha Tbk, you can compare the effects of market volatilities on Optima Prima and Bank Ganesha 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 Optima Prima with a short position of Bank Ganesha. Check out your portfolio center. Please also check ongoing floating volatility patterns of Optima Prima and Bank Ganesha.
Diversification Opportunities for Optima Prima and Bank Ganesha
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Optima and Bank is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Optima Prima Metal and Bank Ganesha Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Ganesha Tbk and Optima Prima 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 Optima Prima Metal are associated (or correlated) with Bank Ganesha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Ganesha Tbk has no effect on the direction of Optima Prima i.e., Optima Prima and Bank Ganesha go up and down completely randomly.
Pair Corralation between Optima Prima and Bank Ganesha
Assuming the 90 days trading horizon Optima Prima Metal is expected to under-perform the Bank Ganesha. In addition to that, Optima Prima is 1.51 times more volatile than Bank Ganesha Tbk. It trades about -0.01 of its total potential returns per unit of risk. Bank Ganesha Tbk is currently generating about 0.07 per unit of volatility. If you would invest 6,700 in Bank Ganesha Tbk on August 28, 2024 and sell it today you would earn a total of 1,600 from holding Bank Ganesha Tbk or generate 23.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Optima Prima Metal vs. Bank Ganesha Tbk
Performance |
| Timeline |
| Optima Prima Metal |
| Bank Ganesha Tbk |
Optima Prima and Bank Ganesha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Optima Prima and Bank Ganesha
The main advantage of trading using opposite Optima Prima and Bank Ganesha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Optima Prima position performs unexpectedly, Bank Ganesha 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 Ganesha will offset losses from the drop in Bank Ganesha's long position.| Optima Prima vs. Gunung Raja Paksi | Optima Prima vs. Emdeki Utama Tbk | Optima Prima vs. Nusantara Almazia | Optima Prima vs. Sentral Mitra Informatika |
| Bank Ganesha vs. Bk Harda Internasional | Bank Ganesha vs. Bank Yudha Bhakti | Bank Ganesha vs. Bank Mnc Internasional | Bank Ganesha vs. Bank Capital 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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