Correlation Between Bank Central and Rayonier
Can any of the company-specific risk be diversified away by investing in both Bank Central and Rayonier 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 Central and Rayonier into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Central Asia and Rayonier, you can compare the effects of market volatilities on Bank Central and Rayonier 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 Central with a short position of Rayonier. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Central and Rayonier.
Diversification Opportunities for Bank Central and Rayonier
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and Rayonier is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Bank Central Asia and Rayonier in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rayonier and Bank Central 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 Central Asia are associated (or correlated) with Rayonier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rayonier has no effect on the direction of Bank Central i.e., Bank Central and Rayonier go up and down completely randomly.
Pair Corralation between Bank Central and Rayonier
Assuming the 90 days horizon Bank Central Asia is expected to generate 1.21 times more return on investment than Rayonier. However, Bank Central is 1.21 times more volatile than Rayonier. It trades about 0.06 of its potential returns per unit of risk. Rayonier is currently generating about -0.13 per unit of risk. If you would invest 1,173 in Bank Central Asia on September 8, 2025 and sell it today you would earn a total of 79.00 from holding Bank Central Asia or generate 6.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Central Asia vs. Rayonier
Performance |
| Timeline |
| Bank Central Asia |
| Rayonier |
Bank Central and Rayonier Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Central and Rayonier
The main advantage of trading using opposite Bank Central and Rayonier positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Central position performs unexpectedly, Rayonier 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 Rayonier will offset losses from the drop in Rayonier's long position.| Bank Central vs. HDFC Bank Limited | Bank Central vs. China Merchants Bank | Bank Central vs. Fifth Third Bancorp | Bank Central vs. Banco Bradesco SA |
| Rayonier vs. RTG Mining | Rayonier vs. CARsgen Therapeutics Holdings | Rayonier vs. CanSino Biologics | Rayonier vs. Canoe Mining Ventures |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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