Correlation Between Bank Mandiri and Mitrabahtera Segara
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Mitrabahtera Segara 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 Mitrabahtera Segara 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 Mitrabahtera Segara Sejati, you can compare the effects of market volatilities on Bank Mandiri and Mitrabahtera Segara 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 Mitrabahtera Segara. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Mitrabahtera Segara.
Diversification Opportunities for Bank Mandiri and Mitrabahtera Segara
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bank and Mitrabahtera is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Mitrabahtera Segara Sejati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitrabahtera Segara 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 Mitrabahtera Segara. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitrabahtera Segara has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Mitrabahtera Segara go up and down completely randomly.
Pair Corralation between Bank Mandiri and Mitrabahtera Segara
Assuming the 90 days trading horizon Bank Mandiri Persero is expected to generate 1.32 times more return on investment than Mitrabahtera Segara. However, Bank Mandiri is 1.32 times more volatile than Mitrabahtera Segara Sejati. It trades about 0.1 of its potential returns per unit of risk. Mitrabahtera Segara Sejati is currently generating about -0.02 per unit of risk. If you would invest 567,500 in Bank Mandiri Persero on October 20, 2024 and sell it today you would earn a total of 22,500 from holding Bank Mandiri Persero or generate 3.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Mandiri Persero vs. Mitrabahtera Segara Sejati
Performance |
| Timeline |
| Bank Mandiri Persero |
| Mitrabahtera Segara |
Bank Mandiri and Mitrabahtera Segara Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and Mitrabahtera Segara
The main advantage of trading using opposite Bank Mandiri and Mitrabahtera Segara positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Mitrabahtera Segara 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 Mitrabahtera Segara will offset losses from the drop in Mitrabahtera Segara'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 |
| Mitrabahtera Segara vs. Adhi Karya Persero | Mitrabahtera Segara vs. Waskita Karya Persero | Mitrabahtera Segara vs. Pembangunan Perumahan PT | Mitrabahtera Segara vs. Jasa Marga Tbk |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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