Correlation Between PT Bank and Zurich Insurance
Can any of the company-specific risk be diversified away by investing in both PT Bank and Zurich Insurance 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 Zurich Insurance 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 Zurich Insurance Group, you can compare the effects of market volatilities on PT Bank and Zurich Insurance 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 Zurich Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Zurich Insurance.
Diversification Opportunities for PT Bank and Zurich Insurance
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PQ9 and Zurich is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Mandiri and Zurich Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zurich Insurance 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 Zurich Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zurich Insurance has no effect on the direction of PT Bank i.e., PT Bank and Zurich Insurance go up and down completely randomly.
Pair Corralation between PT Bank and Zurich Insurance
Assuming the 90 days horizon PT Bank Mandiri is expected to under-perform the Zurich Insurance. In addition to that, PT Bank is 2.45 times more volatile than Zurich Insurance Group. It trades about -0.06 of its total potential returns per unit of risk. Zurich Insurance Group is currently generating about 0.07 per unit of volatility. If you would invest 2,900 in Zurich Insurance Group on November 8, 2024 and sell it today you would earn a total of 80.00 from holding Zurich Insurance Group or generate 2.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bank Mandiri vs. Zurich Insurance Group
Performance |
| Timeline |
| PT Bank Mandiri |
| Zurich Insurance |
PT Bank and Zurich Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Zurich Insurance
The main advantage of trading using opposite PT Bank and Zurich Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Zurich Insurance 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 Zurich Insurance will offset losses from the drop in Zurich Insurance's long position.| PT Bank vs. VIRGIN WINES UK | PT Bank vs. AOYAMA TRADING | PT Bank vs. CHINA TONTINE WINES | PT Bank vs. MidCap Financial Investment |
| Zurich Insurance vs. SPARTAN STORES | Zurich Insurance vs. FIREWEED METALS P | Zurich Insurance vs. SOLSTAD OFFSHORE NK | Zurich Insurance vs. COSTCO WHOLESALE CDR |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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