Correlation Between Trimegah Securities and Bank Rakyat
Can any of the company-specific risk be diversified away by investing in both Trimegah Securities 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 Trimegah Securities and Bank Rakyat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trimegah Securities Tbk and Bank Rakyat Indonesia, you can compare the effects of market volatilities on Trimegah Securities 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 Trimegah Securities with a short position of Bank Rakyat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trimegah Securities and Bank Rakyat.
Diversification Opportunities for Trimegah Securities and Bank Rakyat
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Trimegah and Bank is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Trimegah Securities Tbk and Bank Rakyat Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Rakyat Indonesia and Trimegah Securities 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 Trimegah Securities Tbk 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 Indonesia has no effect on the direction of Trimegah Securities i.e., Trimegah Securities and Bank Rakyat go up and down completely randomly.
Pair Corralation between Trimegah Securities and Bank Rakyat
Assuming the 90 days trading horizon Trimegah Securities Tbk is expected to generate 1.24 times more return on investment than Bank Rakyat. However, Trimegah Securities is 1.24 times more volatile than Bank Rakyat Indonesia. It trades about 0.07 of its potential returns per unit of risk. Bank Rakyat Indonesia is currently generating about -0.01 per unit of risk. If you would invest 35,600 in Trimegah Securities Tbk on November 4, 2024 and sell it today you would earn a total of 1,000.00 from holding Trimegah Securities Tbk or generate 2.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Trimegah Securities Tbk vs. Bank Rakyat Indonesia
Performance |
| Timeline |
| Trimegah Securities Tbk |
| Bank Rakyat Indonesia |
Trimegah Securities and Bank Rakyat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trimegah Securities and Bank Rakyat
The main advantage of trading using opposite Trimegah Securities and Bank Rakyat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trimegah Securities 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.| Trimegah Securities vs. Wahana Ottomitra Multiartha | Trimegah Securities vs. Paninvest Tbk | Trimegah Securities vs. Sinar Mas Multiartha | Trimegah Securities vs. Trias Sentosa Tbk |
| Bank Rakyat vs. Bank Bukopin Tbk | Bank Rakyat vs. Bank BRISyariah Tbk | Bank Rakyat vs. Bank Tabungan Negara | Bank Rakyat vs. Bank Artos Indonesia |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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