Correlation Between PT Bank and AURUBIS -

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

Diversification Opportunities for PT Bank and AURUBIS -

-0.65

Correlation Coefficient

PT Bank  AURUBIS -

Excellent diversification

The 3 months correlation between BYRA and AURUBIS is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and AURUBIS Dusseldorf in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AURUBIS Dusseldorf 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 AURUBIS -. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AURUBIS Dusseldorf has no effect on the direction of PT Bank i.e., PT Bank and AURUBIS - go up and down completely randomly.

Pair Corralation between PT Bank and AURUBIS -

Assuming the 90 days trading horizon PT Bank Rakyat is expected to under-perform the AURUBIS -. In addition to that, PT Bank is 3.58 times more volatile than AURUBIS Dusseldorf. It trades about -0.02 of its total potential returns per unit of risk. AURUBIS Dusseldorf is currently generating about 0.13 per unit of volatility. If you would invest  7,750  in AURUBIS Dusseldorf on December 22, 2024 and sell it today you would earn a total of  1,190  from holding AURUBIS Dusseldorf or generate 15.35% return on investment over 90 days.

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

PT Bank Rakyat  vs.  AURUBIS Dusseldorf

PT Bank Rakyat

Risk-Adjusted Performance

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 latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

AURUBIS Dusseldorf

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in AURUBIS Dusseldorf are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, AURUBIS - unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PT Bank and AURUBIS -

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

The idea behind PT Bank Rakyat and AURUBIS Dusseldorf 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.

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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.