Correlation Between Perusahaan Perseroan and PT Bank
Can any of the company-specific risk be diversified away by investing in both Perusahaan Perseroan and PT Bank 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 PT Bank 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 PT Bank Mandiri, you can compare the effects of market volatilities on Perusahaan Perseroan 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 Perusahaan Perseroan with a short position of PT Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perusahaan Perseroan and PT Bank.
Diversification Opportunities for Perusahaan Perseroan and PT Bank
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Perusahaan and PQ9 is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Perusahaan Perseroan PT and PT Bank Mandiri in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Bank Mandiri 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 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 Mandiri has no effect on the direction of Perusahaan Perseroan i.e., Perusahaan Perseroan and PT Bank go up and down completely randomly.
Pair Corralation between Perusahaan Perseroan and PT Bank
Assuming the 90 days horizon Perusahaan Perseroan PT is expected to under-perform the PT Bank. In addition to that, Perusahaan Perseroan is 1.49 times more volatile than PT Bank Mandiri. It trades about -0.05 of its total potential returns per unit of risk. PT Bank Mandiri is currently generating about -0.07 per unit of volatility. If you would invest 38.00 in PT Bank Mandiri on August 29, 2024 and sell it today you would lose (2.00) from holding PT Bank Mandiri or give up 5.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Perusahaan Perseroan PT vs. PT Bank Mandiri
Performance |
| Timeline |
| Perusahaan Perseroan |
| PT Bank Mandiri |
Perusahaan Perseroan and PT Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perusahaan Perseroan and PT Bank
The main advantage of trading using opposite Perusahaan Perseroan and PT Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perusahaan Perseroan 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.| Perusahaan Perseroan vs. Verizon Communications | Perusahaan Perseroan vs. ATT Inc | Perusahaan Perseroan vs. ATT Inc | Perusahaan Perseroan vs. Deutsche Telekom AG |
| PT Bank vs. China Merchants Bank | PT Bank vs. PT Bank Central | PT Bank vs. State Bank of | PT Bank vs. PT Bank Rakyat |
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 CEOs Directory module to screen CEOs from public companies around the world.
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