Correlation Between Perusahaan Perseroan and BANK RAKYAT
Can any of the company-specific risk be diversified away by investing in both Perusahaan Perseroan and BANK RAKYAT 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 Perusahaan Perseroan and BANK RAKYAT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Perusahaan Perseroan PT and BANK RAKYAT IND, you can compare the effects of market volatilities on Perusahaan Perseroan and BANK RAKYAT 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 Perusahaan Perseroan with a short position of BANK RAKYAT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perusahaan Perseroan and BANK RAKYAT.
Diversification Opportunities for Perusahaan Perseroan and BANK RAKYAT
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Perusahaan and BANK is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Perusahaan Perseroan PT and BANK RAKYAT IND in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANK RAKYAT IND and Perusahaan Perseroan 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 Perusahaan Perseroan PT are associated (or correlated) with BANK RAKYAT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANK RAKYAT IND has no effect on the direction of Perusahaan Perseroan i.e., Perusahaan Perseroan and BANK RAKYAT go up and down completely randomly.
Pair Corralation between Perusahaan Perseroan and BANK RAKYAT
Assuming the 90 days horizon Perusahaan Perseroan is expected to generate 2.17 times less return on investment than BANK RAKYAT. But when comparing it to its historical volatility, Perusahaan Perseroan PT is 1.04 times less risky than BANK RAKYAT. It trades about 0.01 of its potential returns per unit of risk. BANK RAKYAT IND is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 24.00 in BANK RAKYAT IND on September 1, 2024 and sell it today you would earn a total of 0.00 from holding BANK RAKYAT IND or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Perusahaan Perseroan PT vs. BANK RAKYAT IND
Performance |
| Timeline |
| Perusahaan Perseroan |
| BANK RAKYAT IND |
Perusahaan Perseroan and BANK RAKYAT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perusahaan Perseroan and BANK RAKYAT
The main advantage of trading using opposite Perusahaan Perseroan and BANK RAKYAT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perusahaan Perseroan position performs unexpectedly, BANK RAKYAT 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 BANK RAKYAT will offset losses from the drop in BANK RAKYAT's long position.| Perusahaan Perseroan vs. ATT Inc | Perusahaan Perseroan vs. Deutsche Telekom AG | Perusahaan Perseroan vs. Superior Plus Corp | Perusahaan Perseroan vs. NMI Holdings |
| BANK RAKYAT vs. Grand Canyon Education | BANK RAKYAT vs. LG Display Co | BANK RAKYAT vs. Seven West Media | BANK RAKYAT vs. Laureate Education |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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