Correlation Between Bank Pan and PT Pelayaran
Can any of the company-specific risk be diversified away by investing in both Bank Pan and PT Pelayaran 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 PT Pelayaran 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 PT Pelayaran Tamarin, you can compare the effects of market volatilities on Bank Pan and PT Pelayaran 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 PT Pelayaran. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Pan and PT Pelayaran.
Diversification Opportunities for Bank Pan and PT Pelayaran
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and TAMU is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Bank Pan Indonesia and PT Pelayaran Tamarin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Pelayaran Tamarin 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 PT Pelayaran. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Pelayaran Tamarin has no effect on the direction of Bank Pan i.e., Bank Pan and PT Pelayaran go up and down completely randomly.
Pair Corralation between Bank Pan and PT Pelayaran
Assuming the 90 days trading horizon Bank Pan Indonesia is expected to generate 0.48 times more return on investment than PT Pelayaran. However, Bank Pan Indonesia is 2.09 times less risky than PT Pelayaran. It trades about -0.18 of its potential returns per unit of risk. PT Pelayaran Tamarin is currently generating about -0.12 per unit of risk. If you would invest 192,500 in Bank Pan Indonesia on August 28, 2024 and sell it today you would lose (16,000) from holding Bank Pan Indonesia or give up 8.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Pan Indonesia vs. PT Pelayaran Tamarin
Performance |
| Timeline |
| Bank Pan Indonesia |
| PT Pelayaran Tamarin |
Bank Pan and PT Pelayaran Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Pan and PT Pelayaran
The main advantage of trading using opposite Bank Pan and PT Pelayaran positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Pan position performs unexpectedly, PT Pelayaran 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 PT Pelayaran will offset losses from the drop in PT Pelayaran'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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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