Correlation Between Bank Mandiri and Graha Andrasentra
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Graha Andrasentra 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 Mandiri and Graha Andrasentra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Mandiri Persero and Graha Andrasentra Propertindo, you can compare the effects of market volatilities on Bank Mandiri and Graha Andrasentra 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 Mandiri with a short position of Graha Andrasentra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Graha Andrasentra.
Diversification Opportunities for Bank Mandiri and Graha Andrasentra
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Bank and Graha is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Graha Andrasentra Propertindo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Graha Andrasentra and Bank Mandiri 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 Mandiri Persero are associated (or correlated) with Graha Andrasentra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Graha Andrasentra has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Graha Andrasentra go up and down completely randomly.
Pair Corralation between Bank Mandiri and Graha Andrasentra
Assuming the 90 days trading horizon Bank Mandiri Persero is expected to generate 0.48 times more return on investment than Graha Andrasentra. However, Bank Mandiri Persero is 2.09 times less risky than Graha Andrasentra. It trades about -0.38 of its potential returns per unit of risk. Graha Andrasentra Propertindo is currently generating about -0.21 per unit of risk. If you would invest 610,000 in Bank Mandiri Persero on November 28, 2024 and sell it today you would lose (123,000) from holding Bank Mandiri Persero or give up 20.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Mandiri Persero vs. Graha Andrasentra Propertindo
Performance |
| Timeline |
| Bank Mandiri Persero |
| Graha Andrasentra |
Bank Mandiri and Graha Andrasentra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and Graha Andrasentra
The main advantage of trading using opposite Bank Mandiri and Graha Andrasentra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Graha Andrasentra 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 Graha Andrasentra will offset losses from the drop in Graha Andrasentra's long position.| Bank Mandiri vs. Bank Rakyat Indonesia | Bank Mandiri vs. Bank Central Asia | Bank Mandiri vs. Bank Negara Indonesia | Bank Mandiri vs. Astra International Tbk |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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