Correlation Between KB HOME and PT Bank
Can any of the company-specific risk be diversified away by investing in both KB HOME and PT Bank 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 KB HOME and PT Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KB HOME and PT Bank Rakyat, you can compare the effects of market volatilities on KB HOME and PT Bank 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 KB HOME with a short position of PT Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB HOME and PT Bank.
Diversification Opportunities for KB HOME and PT Bank
Good diversification
The 3 months correlation between KBH and BYRA is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding KB HOME and PT Bank Rakyat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Bank Rakyat and KB HOME 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 KB HOME are associated (or correlated) with PT Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Bank Rakyat has no effect on the direction of KB HOME i.e., KB HOME and PT Bank go up and down completely randomly.
Pair Corralation between KB HOME and PT Bank
Assuming the 90 days trading horizon KB HOME is expected to generate 0.5 times more return on investment than PT Bank. However, KB HOME is 1.99 times less risky than PT Bank. It trades about 0.03 of its potential returns per unit of risk. PT Bank Rakyat is currently generating about -0.03 per unit of risk. If you would invest 7,226 in KB HOME on September 9, 2024 and sell it today you would earn a total of 174.00 from holding KB HOME or generate 2.41% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
KB HOME vs. PT Bank Rakyat
Performance |
Timeline |
KB HOME |
PT Bank Rakyat |
KB HOME and PT Bank Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with KB HOME and PT Bank
The main advantage of trading using opposite KB HOME and PT Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB HOME position performs unexpectedly, PT Bank 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 PT Bank will offset losses from the drop in PT Bank's long position.KB HOME vs. Hanison Construction Holdings | KB HOME vs. GOODYEAR T RUBBER | KB HOME vs. Goodyear Tire Rubber | KB HOME vs. Rayonier Advanced Materials |
PT Bank vs. Columbia Sportswear | PT Bank vs. ANDRADA MINING LTD | PT Bank vs. AEGEAN AIRLINES | PT Bank vs. JD SPORTS FASH |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
Global Correlations Find global opportunities by holding instruments from different markets | |
Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |