Correlation Between Bank BRISyariah and Anugerah Kagum

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

Diversification Opportunities for Bank BRISyariah and Anugerah Kagum

0.0

Correlation Coefficient

Bank BRISyariah  Anugerah Kagum

Pay attention - limited upside

The 3 months correlation between Bank and Anugerah is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Bank BRISyariah Tbk and Anugerah Kagum Karya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anugerah Kagum Karya 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 Anugerah Kagum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anugerah Kagum Karya has no effect on the direction of Bank BRISyariah i.e., Bank BRISyariah and Anugerah Kagum go up and down completely randomly.

Pair Corralation between Bank BRISyariah and Anugerah Kagum

If you would invest (100.00) in Bank BRISyariah Tbk on February 7, 2024 and sell it today you would earn a total of  100.00  from holding Bank BRISyariah Tbk or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Bank BRISyariah Tbk  vs.  Anugerah Kagum Karya

Bank BRISyariah Tbk

Risk-Adjusted Performance

0 of 100

OK

Over the last 90 days Bank BRISyariah Tbk has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Bank BRISyariah is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Anugerah Kagum Karya

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Anugerah Kagum Karya 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 quite persistent which may send shares a bit higher in June 2024. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Bank BRISyariah and Anugerah Kagum

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

The idea behind Bank BRISyariah Tbk and Anugerah Kagum Karya 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.