Correlation Between PT Bank and HelloFresh

Can any of the company-specific risk be diversified away by investing in both PT Bank and HelloFresh 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 PT Bank and HelloFresh into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PT Bank Rakyat and HelloFresh SE, you can compare the effects of market volatilities on PT Bank and HelloFresh 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 PT Bank with a short position of HelloFresh. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and HelloFresh.

Diversification Opportunities for PT Bank and HelloFresh

-0.55

Correlation Coefficient

PT Bank  HelloFresh

Excellent diversification

The 3 months correlation between BKRKF and HelloFresh is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and HelloFresh SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HelloFresh SE and PT Bank 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 PT Bank Rakyat are associated (or correlated) with HelloFresh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HelloFresh SE has no effect on the direction of PT Bank i.e., PT Bank and HelloFresh go up and down completely randomly.

Pair Corralation between PT Bank and HelloFresh

Assuming the 90 days horizon PT Bank is expected to generate 83.21 times less return on investment than HelloFresh. But when comparing it to its historical volatility, PT Bank Rakyat is 1.05 times less risky than HelloFresh. It trades about 0.0 of its potential returns per unit of risk. HelloFresh SE is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  600.00  in HelloFresh SE on September 30, 2024 and sell it today you would earn a total of  689.00  from holding HelloFresh SE or generate 114.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

PT Bank Rakyat  vs.  HelloFresh SE

PT Bank Rakyat

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PT Bank Rakyat has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable forward-looking signals, PT Bank is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

HelloFresh SE

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in HelloFresh SE are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady technical and fundamental indicators, HelloFresh reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PT Bank and HelloFresh

The main advantage of trading using opposite PT Bank and HelloFresh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, HelloFresh 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 HelloFresh will offset losses from the drop in HelloFresh's long position.

The idea behind PT Bank Rakyat and HelloFresh SE pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.