Correlation Between Bank Pan and Sejahteraraya Anugrahjaya
Can any of the company-specific risk be diversified away by investing in both Bank Pan and Sejahteraraya Anugrahjaya 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 Pan and Sejahteraraya Anugrahjaya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Pan Indonesia and Sejahteraraya Anugrahjaya Tbk, you can compare the effects of market volatilities on Bank Pan and Sejahteraraya Anugrahjaya 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 Pan with a short position of Sejahteraraya Anugrahjaya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Pan and Sejahteraraya Anugrahjaya.
Diversification Opportunities for Bank Pan and Sejahteraraya Anugrahjaya
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bank and Sejahteraraya is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Bank Pan Indonesia and Sejahteraraya Anugrahjaya Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sejahteraraya Anugrahjaya and Bank Pan 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 Pan Indonesia are associated (or correlated) with Sejahteraraya Anugrahjaya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sejahteraraya Anugrahjaya has no effect on the direction of Bank Pan i.e., Bank Pan and Sejahteraraya Anugrahjaya go up and down completely randomly.
Pair Corralation between Bank Pan and Sejahteraraya Anugrahjaya
Assuming the 90 days trading horizon Bank Pan Indonesia is expected to generate 1.85 times more return on investment than Sejahteraraya Anugrahjaya. However, Bank Pan is 1.85 times more volatile than Sejahteraraya Anugrahjaya Tbk. It trades about 0.13 of its potential returns per unit of risk. Sejahteraraya Anugrahjaya Tbk is currently generating about 0.21 per unit of risk. If you would invest 118,000 in Bank Pan Indonesia on August 30, 2024 and sell it today you would earn a total of 58,000 from holding Bank Pan Indonesia or generate 49.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Pan Indonesia vs. Sejahteraraya Anugrahjaya Tbk
Performance |
| Timeline |
| Bank Pan Indonesia |
| Sejahteraraya Anugrahjaya |
Bank Pan and Sejahteraraya Anugrahjaya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Pan and Sejahteraraya Anugrahjaya
The main advantage of trading using opposite Bank Pan and Sejahteraraya Anugrahjaya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Pan position performs unexpectedly, Sejahteraraya Anugrahjaya 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 Sejahteraraya Anugrahjaya will offset losses from the drop in Sejahteraraya Anugrahjaya's long position.| Bank Pan vs. Bank Danamon Indonesia | Bank Pan vs. Bank Cimb Niaga | Bank Pan vs. Panin Financial Tbk | Bank Pan vs. Bank Maybank 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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