Correlation Between PT Bank and Bionoid Pharma

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

By analyzing existing cross correlation between PT Bank Central and Bionoid Pharma, you can compare the effects of market volatilities on PT Bank and Bionoid Pharma 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 Bionoid Pharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Bionoid Pharma.

Diversification Opportunities for PT Bank and Bionoid Pharma

-0.42

Correlation Coefficient

PT Bank  Bionoid Pharma

Very good diversification

The 3 months correlation between PBCRF and Bionoid is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Central and Bionoid Pharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bionoid Pharma 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 Central are associated (or correlated) with Bionoid Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bionoid Pharma has no effect on the direction of PT Bank i.e., PT Bank and Bionoid Pharma go up and down completely randomly.

Pair Corralation between PT Bank and Bionoid Pharma

Assuming the 90 days horizon PT Bank Central is expected to generate 0.95 times more return on investment than Bionoid Pharma. However, PT Bank Central is 1.05 times less risky than Bionoid Pharma. It trades about 0.02 of its potential returns per unit of risk. Bionoid Pharma is currently generating about -0.2 per unit of risk. If you would invest  59.00  in PT Bank Central on October 24, 2024 and sell it today you would earn a total of  0.00  from holding PT Bank Central or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	90.0%
Values	Daily Returns

PT Bank Central  vs.  Bionoid Pharma

PT Bank Central

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PT Bank Central has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Bionoid Pharma

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Bionoid Pharma are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Bionoid Pharma reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PT Bank and Bionoid Pharma

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

The idea behind PT Bank Central and Bionoid Pharma 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.