Correlation Between Trust Finance and Bank BRISyariah
Can any of the company-specific risk be diversified away by investing in both Trust Finance and Bank BRISyariah 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 Trust Finance and Bank BRISyariah into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trust Finance Indonesia and Bank BRISyariah Tbk, you can compare the effects of market volatilities on Trust Finance and Bank BRISyariah 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 Trust Finance with a short position of Bank BRISyariah. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trust Finance and Bank BRISyariah.
Diversification Opportunities for Trust Finance and Bank BRISyariah
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Trust and Bank is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Trust Finance Indonesia and Bank BRISyariah Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank BRISyariah Tbk and Trust Finance 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 Trust Finance Indonesia are associated (or correlated) with Bank BRISyariah. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank BRISyariah Tbk has no effect on the direction of Trust Finance i.e., Trust Finance and Bank BRISyariah go up and down completely randomly.
Pair Corralation between Trust Finance and Bank BRISyariah
Assuming the 90 days trading horizon Trust Finance is expected to generate 2.16 times less return on investment than Bank BRISyariah. But when comparing it to its historical volatility, Trust Finance Indonesia is 1.31 times less risky than Bank BRISyariah. It trades about 0.05 of its potential returns per unit of risk. Bank BRISyariah Tbk is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 259,000 in Bank BRISyariah Tbk on September 3, 2024 and sell it today you would earn a total of 31,000 from holding Bank BRISyariah Tbk or generate 11.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Trust Finance Indonesia vs. Bank BRISyariah Tbk
Performance |
| Timeline |
| Trust Finance Indonesia |
| Bank BRISyariah Tbk |
Trust Finance and Bank BRISyariah Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trust Finance and Bank BRISyariah
The main advantage of trading using opposite Trust Finance and Bank BRISyariah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trust Finance position performs unexpectedly, Bank BRISyariah 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 BRISyariah will offset losses from the drop in Bank BRISyariah's long position.| Trust Finance vs. Wahana Ottomitra Multiartha | Trust Finance vs. Yulie Sekurindo Tbk | Trust Finance vs. Trimegah Securities Tbk | Trust Finance vs. Mandala Multifinance Tbk |
| Bank BRISyariah vs. Aneka Tambang Persero | Bank BRISyariah vs. Sido Muncul PT | Bank BRISyariah vs. Indofood Cbp Sukses | Bank BRISyariah vs. Bank Tabungan Pensiunan |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |