Correlation Between Bank BRISyariah and Adira Dinamika
Can any of the company-specific risk be diversified away by investing in both Bank BRISyariah and Adira Dinamika 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 BRISyariah and Adira Dinamika into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank BRISyariah Tbk and Adira Dinamika Multi, you can compare the effects of market volatilities on Bank BRISyariah and Adira Dinamika 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 BRISyariah with a short position of Adira Dinamika. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank BRISyariah and Adira Dinamika.
Diversification Opportunities for Bank BRISyariah and Adira Dinamika
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Bank and Adira is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Bank BRISyariah Tbk and Adira Dinamika Multi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adira Dinamika Multi and Bank BRISyariah 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 BRISyariah Tbk are associated (or correlated) with Adira Dinamika. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adira Dinamika Multi has no effect on the direction of Bank BRISyariah i.e., Bank BRISyariah and Adira Dinamika go up and down completely randomly.
Pair Corralation between Bank BRISyariah and Adira Dinamika
Assuming the 90 days trading horizon Bank BRISyariah Tbk is expected to generate 2.9 times more return on investment than Adira Dinamika. However, Bank BRISyariah is 2.9 times more volatile than Adira Dinamika Multi. It trades about -0.08 of its potential returns per unit of risk. Adira Dinamika Multi is currently generating about -0.3 per unit of risk. If you would invest 284,000 in Bank BRISyariah Tbk on December 1, 2024 and sell it today you would lose (33,000) from holding Bank BRISyariah Tbk or give up 11.62% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Bank BRISyariah Tbk vs. Adira Dinamika Multi
Performance |
Timeline |
Bank BRISyariah Tbk |
Adira Dinamika Multi |
Bank BRISyariah and Adira Dinamika Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bank BRISyariah and Adira Dinamika
The main advantage of trading using opposite Bank BRISyariah and Adira Dinamika positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank BRISyariah position performs unexpectedly, Adira Dinamika 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 Adira Dinamika will offset losses from the drop in Adira Dinamika's long position.Bank BRISyariah vs. Aneka Tambang Persero | Bank BRISyariah vs. Sido Muncul PT | Bank BRISyariah vs. Indofood Cbp Sukses | Bank BRISyariah vs. Bank Tabungan Pensiunan |
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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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