Correlation Between Bank Negara and Orefinders Resources
Can any of the company-specific risk be diversified away by investing in both Bank Negara and Orefinders Resources 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 Bank Negara and Orefinders Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Negara Indonesia and Orefinders Resources, you can compare the effects of market volatilities on Bank Negara and Orefinders Resources 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 Bank Negara with a short position of Orefinders Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Negara and Orefinders Resources.
Diversification Opportunities for Bank Negara and Orefinders Resources
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and Orefinders is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Bank Negara Indonesia and Orefinders Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orefinders Resources and Bank Negara 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 Bank Negara Indonesia are associated (or correlated) with Orefinders Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orefinders Resources has no effect on the direction of Bank Negara i.e., Bank Negara and Orefinders Resources go up and down completely randomly.
Pair Corralation between Bank Negara and Orefinders Resources
Assuming the 90 days horizon Bank Negara Indonesia is expected to under-perform the Orefinders Resources. In addition to that, Bank Negara is 1.08 times more volatile than Orefinders Resources. It trades about -0.09 of its total potential returns per unit of risk. Orefinders Resources is currently generating about 0.1 per unit of volatility. If you would invest 4.32 in Orefinders Resources on September 1, 2024 and sell it today you would earn a total of 0.29 from holding Orefinders Resources or generate 6.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Negara Indonesia vs. Orefinders Resources
Performance |
| Timeline |
| Bank Negara Indonesia |
| Orefinders Resources |
Bank Negara and Orefinders Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Negara and Orefinders Resources
The main advantage of trading using opposite Bank Negara and Orefinders Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Negara position performs unexpectedly, Orefinders Resources 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 Orefinders Resources will offset losses from the drop in Orefinders Resources' long position.| Bank Negara vs. Piraeus Bank SA | Bank Negara vs. Turkiye Garanti Bankasi | Bank Negara vs. Delhi Bank Corp | Bank Negara vs. Uwharrie Capital Corp |
| Orefinders Resources vs. Aurion Resources | Orefinders Resources vs. Rio2 Limited | Orefinders Resources vs. Palamina Corp | Orefinders Resources vs. BTU Metals Corp |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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