Correlation Between PT Bank and Canadian Western
Can any of the company-specific risk be diversified away by investing in both PT Bank and Canadian Western 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 Canadian Western 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 Canadian Western Bank, you can compare the effects of market volatilities on PT Bank and Canadian Western 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 Canadian Western. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Canadian Western.
Diversification Opportunities for PT Bank and Canadian Western
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BKRKF and Canadian is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Canadian Western Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Western Bank 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 Canadian Western. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Western Bank has no effect on the direction of PT Bank i.e., PT Bank and Canadian Western go up and down completely randomly.
Pair Corralation between PT Bank and Canadian Western
Assuming the 90 days horizon PT Bank Rakyat is expected to generate 3.33 times more return on investment than Canadian Western. However, PT Bank is 3.33 times more volatile than Canadian Western Bank. It trades about -0.02 of its potential returns per unit of risk. Canadian Western Bank is currently generating about -0.08 per unit of risk. If you would invest 26.00 in PT Bank Rakyat on September 24, 2024 and sell it today you would lose (2.00) from holding PT Bank Rakyat or give up 7.69% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
PT Bank Rakyat vs. Canadian Western Bank
Performance |
Timeline |
PT Bank Rakyat |
Canadian Western Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
PT Bank and Canadian Western Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with PT Bank and Canadian Western
The main advantage of trading using opposite PT Bank and Canadian Western positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Canadian Western 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 Canadian Western will offset losses from the drop in Canadian Western's long position.PT Bank vs. Banco Bradesco SA | PT Bank vs. Itau Unibanco Banco | PT Bank vs. Lloyds Banking Group | PT Bank vs. Deutsche Bank AG |
Canadian Western vs. China Merchants Bank | Canadian Western vs. Nordea Bank Abp | Canadian Western vs. DBS Group Holdings | Canadian Western vs. Tompkins Financial |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
CEOs Directory Screen CEOs from public companies around the world |