Correlation Between PT Bank and Puma Exploration
Can any of the company-specific risk be diversified away by investing in both PT Bank and Puma Exploration 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 Bank and Puma Exploration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Bank Central and Puma Exploration, you can compare the effects of market volatilities on PT Bank and Puma Exploration 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 Bank with a short position of Puma Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Puma Exploration.
Diversification Opportunities for PT Bank and Puma Exploration
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PBCRF and Puma is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Central and Puma Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Puma Exploration and PT Bank 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 Bank Central are associated (or correlated) with Puma Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Puma Exploration has no effect on the direction of PT Bank i.e., PT Bank and Puma Exploration go up and down completely randomly.
Pair Corralation between PT Bank and Puma Exploration
Assuming the 90 days horizon PT Bank Central is expected to under-perform the Puma Exploration. In addition to that, PT Bank is 1.01 times more volatile than Puma Exploration. It trades about 0.0 of its total potential returns per unit of risk. Puma Exploration is currently generating about 0.02 per unit of volatility. If you would invest 6.00 in Puma Exploration on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Puma Exploration or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bank Central vs. Puma Exploration
Performance |
| Timeline |
| PT Bank Central |
| Puma Exploration |
PT Bank and Puma Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Puma Exploration
The main advantage of trading using opposite PT Bank and Puma Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Puma Exploration 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 Puma Exploration will offset losses from the drop in Puma Exploration's long position.The idea behind PT Bank Central and Puma Exploration pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Puma Exploration vs. Aurion Resources | Puma Exploration vs. Liberty Gold Corp | Puma Exploration vs. Orezone Gold Corp | Puma Exploration vs. Fortuna Silver Mines |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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