Correlation Between PT Bank and Pyramidion Technology

Can any of the company-specific risk be diversified away by investing in both PT Bank and Pyramidion Technology 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 Pyramidion Technology 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 Pyramidion Technology Group, you can compare the effects of market volatilities on PT Bank and Pyramidion Technology 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 Pyramidion Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Pyramidion Technology.

Diversification Opportunities for PT Bank and Pyramidion Technology

0.06

Correlation Coefficient

PT Bank  Pyramidion Technology

Significant diversification

The 3 months correlation between BKRKF and Pyramidion is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Pyramidion Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pyramidion Technology 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 Pyramidion Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pyramidion Technology has no effect on the direction of PT Bank i.e., PT Bank and Pyramidion Technology go up and down completely randomly.

Pair Corralation between PT Bank and Pyramidion Technology

Assuming the 90 days horizon PT Bank is expected to generate 32.95 times less return on investment than Pyramidion Technology. But when comparing it to its historical volatility, PT Bank Rakyat is 12.04 times less risky than Pyramidion Technology. It trades about 0.05 of its potential returns per unit of risk. Pyramidion Technology Group is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  0.03  in Pyramidion Technology Group on December 29, 2024 and sell it today you would earn a total of  0.27  from holding Pyramidion Technology Group or generate 900.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	93.55%
Values	Daily Returns

PT Bank Rakyat  vs.  Pyramidion Technology Group

PT Bank Rakyat

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in PT Bank Rakyat are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile forward-looking signals, PT Bank reported solid returns over the last few months and may actually be approaching a breakup point.

Pyramidion Technology

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Pyramidion Technology Group are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak technical and fundamental indicators, Pyramidion Technology sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PT Bank and Pyramidion Technology

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

The idea behind PT Bank Rakyat and Pyramidion Technology Group 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.