Correlation Between Bank Dinar and Panin Sekuritas

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Can any of the company-specific risk be diversified away by investing in both Bank Dinar and Panin Sekuritas 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 Dinar and Panin Sekuritas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Dinar Indonesia and Panin Sekuritas Tbk, you can compare the effects of market volatilities on Bank Dinar and Panin Sekuritas 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 Dinar with a short position of Panin Sekuritas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Dinar and Panin Sekuritas.

Diversification Opportunities for Bank Dinar and Panin Sekuritas

BankPaninDiversified AwayBankPaninDiversified Away100%
0.45
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Bank and Panin is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Bank Dinar Indonesia and Panin Sekuritas Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Panin Sekuritas Tbk and Bank Dinar 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 Dinar Indonesia are associated (or correlated) with Panin Sekuritas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Panin Sekuritas Tbk has no effect on the direction of Bank Dinar i.e., Bank Dinar and Panin Sekuritas go up and down completely randomly.

Pair Corralation between Bank Dinar and Panin Sekuritas

If you would invest  0.00  in Bank Dinar Indonesia on September 16, 2024 and sell it today you would earn a total of  0.00  from holding Bank Dinar Indonesia or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy4.76%
ValuesDaily Returns

Bank Dinar Indonesia  vs.  Panin Sekuritas Tbk

 Performance 
JavaScript chart by amCharts 3.21.15OctNov -30-20-100102030
JavaScript chart by amCharts 3.21.15DNAR PANS
       Timeline  
Bank Dinar Indonesia 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
OK
Over the last 90 days Bank Dinar Indonesia has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite weak forward-looking signals, Bank Dinar disclosed solid returns over the last few months and may actually be approaching a breakup point.
Panin Sekuritas Tbk 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Panin Sekuritas Tbk are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, Panin Sekuritas is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec1,6001,6101,6201,6301,6401,6501,6601,6701,680

Bank Dinar and Panin Sekuritas Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-25.66-19.22-12.78-6.330.016.713.5120.3227.13 0.10.20.30.40.50.6
JavaScript chart by amCharts 3.21.15DNAR PANS
       Returns  

Pair Trading with Bank Dinar and Panin Sekuritas

The main advantage of trading using opposite Bank Dinar and Panin Sekuritas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Dinar position performs unexpectedly, Panin Sekuritas 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 Panin Sekuritas will offset losses from the drop in Panin Sekuritas' long position.
The idea behind Bank Dinar Indonesia and Panin Sekuritas Tbk 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.

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