Correlation Between Bank Panin and Central Omega
Can any of the company-specific risk be diversified away by investing in both Bank Panin and Central Omega 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 Panin and Central Omega into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Panin Syariah and Central Omega Resources, you can compare the effects of market volatilities on Bank Panin and Central Omega 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 Panin with a short position of Central Omega. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Panin and Central Omega.
Diversification Opportunities for Bank Panin and Central Omega
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bank and Central is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Bank Panin Syariah and Central Omega Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Central Omega Resources and Bank Panin 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 Panin Syariah are associated (or correlated) with Central Omega. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Central Omega Resources has no effect on the direction of Bank Panin i.e., Bank Panin and Central Omega go up and down completely randomly.
Pair Corralation between Bank Panin and Central Omega
Assuming the 90 days trading horizon Bank Panin Syariah is expected to under-perform the Central Omega. But the stock apears to be less risky and, when comparing its historical volatility, Bank Panin Syariah is 2.01 times less risky than Central Omega. The stock trades about -0.03 of its potential returns per unit of risk. The Central Omega Resources is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 11,500 in Central Omega Resources on August 28, 2024 and sell it today you would earn a total of 9,700 from holding Central Omega Resources or generate 84.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Panin Syariah vs. Central Omega Resources
Performance |
| Timeline |
| Bank Panin Syariah |
| Central Omega Resources |
Bank Panin and Central Omega Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Panin and Central Omega
The main advantage of trading using opposite Bank Panin and Central Omega positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Panin position performs unexpectedly, Central Omega 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 Central Omega will offset losses from the drop in Central Omega's long position.| Bank Panin vs. Bank Windu Kentjana | Bank Panin vs. Bank Mnc Internasional | Bank Panin vs. Bank Ganesha Tbk | Bank Panin vs. Bank Pan Indonesia |
| Central Omega vs. Cita Mineral Investindo | Central Omega vs. Intiland Development Tbk | Central Omega vs. J Resources Asia | Central Omega vs. Resource Alam 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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