Correlation Between PT Bank and Seven I
Can any of the company-specific risk be diversified away by investing in both PT Bank and Seven I 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 Seven I 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 Seven i Holdings, you can compare the effects of market volatilities on PT Bank and Seven I 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 Seven I. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Seven I.
Diversification Opportunities for PT Bank and Seven I
Excellent diversification
The 3 months correlation between PQ9 and Seven is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Mandiri and Seven i Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seven i Holdings 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 Seven I. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seven i Holdings has no effect on the direction of PT Bank i.e., PT Bank and Seven I go up and down completely randomly.
Pair Corralation between PT Bank and Seven I
Assuming the 90 days horizon PT Bank Mandiri is expected to under-perform the Seven I. In addition to that, PT Bank is 1.64 times more volatile than Seven i Holdings. It trades about -0.08 of its total potential returns per unit of risk. Seven i Holdings is currently generating about 0.35 per unit of volatility. If you would invest 1,303 in Seven i Holdings on September 1, 2024 and sell it today you would earn a total of 315.00 from holding Seven i Holdings or generate 24.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bank Mandiri vs. Seven i Holdings
Performance |
| Timeline |
| PT Bank Mandiri |
| Seven i Holdings |
PT Bank and Seven I Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Seven I
The main advantage of trading using opposite PT Bank and Seven I positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Seven I 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 Seven I will offset losses from the drop in Seven I's long position.| PT Bank vs. CODERE ONLINE LUX | PT Bank vs. Sumitomo Chemical | PT Bank vs. British American Tobacco | PT Bank vs. TIANDE CHEMICAL |
| Seven I vs. TESCO PLC LS 0633333 | Seven I vs. Superior Plus Corp | Seven I vs. NMI Holdings | Seven I vs. Origin Agritech |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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