Correlation Between PT Bank and Trisura Group
Can any of the company-specific risk be diversified away by investing in both PT Bank and Trisura Group 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 Trisura Group 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 Trisura Group, you can compare the effects of market volatilities on PT Bank and Trisura Group 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 Trisura Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Trisura Group.
Diversification Opportunities for PT Bank and Trisura Group
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PBCRF and Trisura is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Central and Trisura Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trisura Group 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 Trisura Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trisura Group has no effect on the direction of PT Bank i.e., PT Bank and Trisura Group go up and down completely randomly.
Pair Corralation between PT Bank and Trisura Group
Assuming the 90 days horizon PT Bank Central is expected to generate 2.02 times more return on investment than Trisura Group. However, PT Bank is 2.02 times more volatile than Trisura Group. It trades about 0.03 of its potential returns per unit of risk. Trisura Group is currently generating about 0.01 per unit of risk. If you would invest 59.00 in PT Bank Central on September 1, 2024 and sell it today you would earn a total of 8.00 from holding PT Bank Central or generate 13.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.85% |
| Values | Daily Returns |
PT Bank Central vs. Trisura Group
Performance |
| Timeline |
| PT Bank Central |
| Trisura Group |
PT Bank and Trisura Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Trisura Group
The main advantage of trading using opposite PT Bank and Trisura Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Trisura Group 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 Trisura Group will offset losses from the drop in Trisura Group's long position.| PT Bank vs. Bank Mandiri Persero | PT Bank vs. Piraeus Bank SA | PT Bank vs. Kasikornbank Public Co | PT Bank vs. Turkiye Garanti Bankasi |
| Trisura Group vs. James River Group | Trisura Group vs. ICC Holdings | Trisura Group vs. AMERISAFE | Trisura Group vs. Employers Holdings |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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