Correlation Between Panin Financial and Pacific Strategic
Can any of the company-specific risk be diversified away by investing in both Panin Financial and Pacific Strategic 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 Panin Financial and Pacific Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Panin Financial Tbk and Pacific Strategic Financial, you can compare the effects of market volatilities on Panin Financial and Pacific Strategic 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 Panin Financial with a short position of Pacific Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Panin Financial and Pacific Strategic.
Diversification Opportunities for Panin Financial and Pacific Strategic
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Panin and Pacific is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Panin Financial Tbk and Pacific Strategic Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pacific Strategic and Panin Financial 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 Panin Financial Tbk are associated (or correlated) with Pacific Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pacific Strategic has no effect on the direction of Panin Financial i.e., Panin Financial and Pacific Strategic go up and down completely randomly.
Pair Corralation between Panin Financial and Pacific Strategic
Assuming the 90 days trading horizon Panin Financial Tbk is expected to under-perform the Pacific Strategic. In addition to that, Panin Financial is 2.68 times more volatile than Pacific Strategic Financial. It trades about -0.02 of its total potential returns per unit of risk. Pacific Strategic Financial is currently generating about 0.35 per unit of volatility. If you would invest 108,500 in Pacific Strategic Financial on October 26, 2024 and sell it today you would earn a total of 6,000 from holding Pacific Strategic Financial or generate 5.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Panin Financial Tbk vs. Pacific Strategic Financial
Performance |
| Timeline |
| Panin Financial Tbk |
| Pacific Strategic |
Panin Financial and Pacific Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Panin Financial and Pacific Strategic
The main advantage of trading using opposite Panin Financial and Pacific Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Panin Financial position performs unexpectedly, Pacific Strategic 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 Pacific Strategic will offset losses from the drop in Pacific Strategic's long position.| Panin Financial vs. Bank Pan Indonesia | Panin Financial vs. Paninvest Tbk | Panin Financial vs. Kawasan Industri Jababeka | Panin Financial vs. Global Mediacom Tbk |
| Pacific Strategic vs. Asuransi Harta Aman | Pacific Strategic vs. Asuransi Bintang Tbk | Pacific Strategic vs. Mnc Kapital Indonesia | Pacific Strategic vs. Arthavest Tbk |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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