Correlation Between PT Bank and Eaton Vance

Can any of the company-specific risk be diversified away by investing in both PT Bank and Eaton Vance 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 Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PT Bank Central and Eaton Vance Municipal, you can compare the effects of market volatilities on PT Bank and Eaton Vance 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 Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Eaton Vance.

Diversification Opportunities for PT Bank and Eaton Vance

-0.38

Correlation Coefficient

PT Bank  Eaton Vance

Very good diversification

The 3 months correlation between PBCRF and Eaton is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Central and Eaton Vance Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Municipal 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 Central are associated (or correlated) with Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Municipal has no effect on the direction of PT Bank i.e., PT Bank and Eaton Vance go up and down completely randomly.

Pair Corralation between PT Bank and Eaton Vance

Assuming the 90 days horizon PT Bank Central is expected to under-perform the Eaton Vance. In addition to that, PT Bank is 5.96 times more volatile than Eaton Vance Municipal. It trades about -0.02 of its total potential returns per unit of risk. Eaton Vance Municipal is currently generating about 0.11 per unit of volatility. If you would invest  1,012  in Eaton Vance Municipal on May 4, 2025 and sell it today you would earn a total of  38.00  from holding Eaton Vance Municipal or generate 3.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

PT Bank Central  vs.  Eaton Vance Municipal

PT Bank Central

Risk-Adjusted Performance

Very Weak

Over the last 90 days PT Bank Central has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, PT Bank is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Eaton Vance Municipal

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Eaton Vance Municipal are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Eaton Vance is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with PT Bank and Eaton Vance

The main advantage of trading using opposite PT Bank and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Eaton Vance 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 Eaton Vance will offset losses from the drop in Eaton Vance's long position.

The idea behind PT Bank Central and Eaton Vance Municipal 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.

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 AI Portfolio Prophet module to use AI to generate optimal portfolios and find profitable investment opportunities.