Correlation Between Southeastern Banking and PT Bank
Can any of the company-specific risk be diversified away by investing in both Southeastern Banking 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 Southeastern Banking and PT Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Southeastern Banking Corp and PT Bank Rakyat, you can compare the effects of market volatilities on Southeastern Banking 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 Southeastern Banking with a short position of PT Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Southeastern Banking and PT Bank.
Diversification Opportunities for Southeastern Banking and PT Bank
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Southeastern and BKRKF is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Southeastern Banking Corp 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 Southeastern Banking 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 Southeastern Banking Corp 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 Southeastern Banking i.e., Southeastern Banking and PT Bank go up and down completely randomly.
Pair Corralation between Southeastern Banking and PT Bank
Given the investment horizon of 90 days Southeastern Banking Corp is expected to generate 0.24 times more return on investment than PT Bank. However, Southeastern Banking Corp is 4.23 times less risky than PT Bank. It trades about 0.36 of its potential returns per unit of risk. PT Bank Rakyat is currently generating about 0.06 per unit of risk. If you would invest 2,227 in Southeastern Banking Corp on September 12, 2024 and sell it today you would earn a total of 273.00 from holding Southeastern Banking Corp or generate 12.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
Southeastern Banking Corp vs. PT Bank Rakyat
Performance |
| Timeline |
| Southeastern Banking Corp |
| PT Bank Rakyat |
Southeastern Banking and PT Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Southeastern Banking and PT Bank
The main advantage of trading using opposite Southeastern Banking and PT Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Southeastern Banking 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.| Southeastern Banking vs. PT Bank Rakyat | Southeastern Banking vs. Morningstar Unconstrained Allocation | Southeastern Banking vs. Bondbloxx ETF Trust | Southeastern Banking vs. Spring Valley Acquisition |
| PT Bank vs. Morningstar Unconstrained Allocation | PT Bank vs. Bondbloxx ETF Trust | PT Bank vs. Spring Valley Acquisition | PT Bank vs. Bondbloxx ETF Trust |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |