Correlation Between PSI Software and PT Bank
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By analyzing existing cross correlation between PSI Software AG and PT Bank Rakyat, you can compare the effects of market volatilities on PSI Software and PT Bank 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 PSI Software with a short position of PT Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of PSI Software and PT Bank.
Diversification Opportunities for PSI Software and PT Bank
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PSI and BYRA is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding PSI Software AG and PT Bank Rakyat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Bank Rakyat and PSI Software 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 PSI Software AG are associated (or correlated) with PT Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Bank Rakyat has no effect on the direction of PSI Software i.e., PSI Software and PT Bank go up and down completely randomly.
Pair Corralation between PSI Software and PT Bank
Assuming the 90 days trading horizon PSI Software AG is expected to under-perform the PT Bank. But the stock apears to be less risky and, when comparing its historical volatility, PSI Software AG is 6.18 times less risky than PT Bank. The stock trades about -0.14 of its potential returns per unit of risk. The PT Bank Rakyat is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 25.00 in PT Bank Rakyat on September 13, 2024 and sell it today you would lose (1.00) from holding PT Bank Rakyat or give up 4.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PSI Software AG vs. PT Bank Rakyat
Performance |
| Timeline |
| PSI Software AG |
| PT Bank Rakyat |
PSI Software and PT Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PSI Software and PT Bank
The main advantage of trading using opposite PSI Software and PT Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PSI Software position performs unexpectedly, PT Bank 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 PT Bank will offset losses from the drop in PT Bank's long position.| PSI Software vs. Salesforce | PSI Software vs. Superior Plus Corp | PSI Software vs. SIVERS SEMICONDUCTORS AB | PSI Software vs. Norsk Hydro ASA |
| PT Bank vs. Consolidated Communications Holdings | PT Bank vs. Verizon Communications | PT Bank vs. GRIFFIN MINING LTD | PT Bank vs. Spirent Communications plc |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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