Correlation Between PT Bank and CarPartsCom
Can any of the company-specific risk be diversified away by investing in both PT Bank and CarPartsCom 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 CarPartsCom 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 CarPartsCom, you can compare the effects of market volatilities on PT Bank and CarPartsCom 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 CarPartsCom. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and CarPartsCom.
Diversification Opportunities for PT Bank and CarPartsCom
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BKRKF and CarPartsCom is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and CarPartsCom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CarPartsCom 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 CarPartsCom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CarPartsCom has no effect on the direction of PT Bank i.e., PT Bank and CarPartsCom go up and down completely randomly.
Pair Corralation between PT Bank and CarPartsCom
Assuming the 90 days horizon PT Bank Rakyat is expected to generate 0.26 times more return on investment than CarPartsCom. However, PT Bank Rakyat is 3.78 times less risky than CarPartsCom. It trades about 0.1 of its potential returns per unit of risk. CarPartsCom is currently generating about -0.06 per unit of risk. If you would invest 21.00 in PT Bank Rakyat on August 16, 2025 and sell it today you would earn a total of 2.00 from holding PT Bank Rakyat or generate 9.52% 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. CarPartsCom
Performance |
| Timeline |
| PT Bank Rakyat |
| CarPartsCom |
PT Bank and CarPartsCom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and CarPartsCom
The main advantage of trading using opposite PT Bank and CarPartsCom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, CarPartsCom 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 CarPartsCom will offset losses from the drop in CarPartsCom's long position.| PT Bank vs. Erste Group Bank | PT Bank vs. Postal Savings Bank | PT Bank vs. Lloyds Banking Group | PT Bank vs. ING Groep NV |
| CarPartsCom vs. QVC Group | CarPartsCom vs. The Brand House | CarPartsCom vs. Tillys Inc | CarPartsCom vs. Foresight Autonomous Holdings |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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