Correlation Between Bank Rakyat and Paninvest Tbk
Can any of the company-specific risk be diversified away by investing in both Bank Rakyat and Paninvest Tbk 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 Bank Rakyat and Paninvest Tbk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Rakyat Indonesia and Paninvest Tbk, you can compare the effects of market volatilities on Bank Rakyat and Paninvest Tbk 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 Bank Rakyat with a short position of Paninvest Tbk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Rakyat and Paninvest Tbk.
Diversification Opportunities for Bank Rakyat and Paninvest Tbk
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and Paninvest is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Bank Rakyat Indonesia and Paninvest Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Paninvest Tbk and Bank Rakyat 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 Bank Rakyat Indonesia are associated (or correlated) with Paninvest Tbk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Paninvest Tbk has no effect on the direction of Bank Rakyat i.e., Bank Rakyat and Paninvest Tbk go up and down completely randomly.
Pair Corralation between Bank Rakyat and Paninvest Tbk
Assuming the 90 days trading horizon Bank Rakyat Indonesia is expected to under-perform the Paninvest Tbk. But the stock apears to be less risky and, when comparing its historical volatility, Bank Rakyat Indonesia is 1.27 times less risky than Paninvest Tbk. The stock trades about -0.09 of its potential returns per unit of risk. The Paninvest Tbk is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 95,500 in Paninvest Tbk on September 3, 2024 and sell it today you would earn a total of 11,000 from holding Paninvest Tbk or generate 11.52% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Bank Rakyat Indonesia vs. Paninvest Tbk
Performance |
Timeline |
Bank Rakyat Indonesia |
Paninvest Tbk |
Bank Rakyat and Paninvest Tbk Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bank Rakyat and Paninvest Tbk
The main advantage of trading using opposite Bank Rakyat and Paninvest Tbk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Rakyat position performs unexpectedly, Paninvest Tbk 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 Paninvest Tbk will offset losses from the drop in Paninvest Tbk's long position.Bank Rakyat vs. Paninvest Tbk | Bank Rakyat vs. Mitra Pinasthika Mustika | Bank Rakyat vs. Jakarta Int Hotels | Bank Rakyat vs. Asuransi Harta Aman |
Paninvest Tbk vs. Panin Financial Tbk | Paninvest Tbk vs. Bank Pan Indonesia | Paninvest Tbk vs. Panin Sekuritas Tbk | Paninvest Tbk vs. Clipan Finance 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |