Correlation Between PT Bank and Inmobiliaria Colonial
Can any of the company-specific risk be diversified away by investing in both PT Bank and Inmobiliaria Colonial 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 Inmobiliaria Colonial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Bank Mandiri and Inmobiliaria Colonial SOCIMI, you can compare the effects of market volatilities on PT Bank and Inmobiliaria Colonial 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 Inmobiliaria Colonial. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Inmobiliaria Colonial.
Diversification Opportunities for PT Bank and Inmobiliaria Colonial
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PQ9 and Inmobiliaria is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Mandiri and Inmobiliaria Colonial SOCIMI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inmobiliaria Colonial 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 Mandiri are associated (or correlated) with Inmobiliaria Colonial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inmobiliaria Colonial has no effect on the direction of PT Bank i.e., PT Bank and Inmobiliaria Colonial go up and down completely randomly.
Pair Corralation between PT Bank and Inmobiliaria Colonial
Assuming the 90 days horizon PT Bank Mandiri is expected to generate 2.72 times more return on investment than Inmobiliaria Colonial. However, PT Bank is 2.72 times more volatile than Inmobiliaria Colonial SOCIMI. It trades about 0.03 of its potential returns per unit of risk. Inmobiliaria Colonial SOCIMI is currently generating about 0.01 per unit of risk. If you would invest 29.00 in PT Bank Mandiri on September 2, 2024 and sell it today you would earn a total of 6.00 from holding PT Bank Mandiri or generate 20.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bank Mandiri vs. Inmobiliaria Colonial SOCIMI
Performance |
| Timeline |
| PT Bank Mandiri |
| Inmobiliaria Colonial |
PT Bank and Inmobiliaria Colonial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Inmobiliaria Colonial
The main advantage of trading using opposite PT Bank and Inmobiliaria Colonial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Inmobiliaria Colonial 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 Inmobiliaria Colonial will offset losses from the drop in Inmobiliaria Colonial's long position.The idea behind PT Bank Mandiri and Inmobiliaria Colonial SOCIMI pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Inmobiliaria Colonial vs. Superior Plus Corp | Inmobiliaria Colonial vs. NMI Holdings | Inmobiliaria Colonial vs. Origin Agritech | Inmobiliaria Colonial vs. SIVERS SEMICONDUCTORS AB |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |