Correlation Between Bank Mandiri and Trisula International
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Trisula International 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 Trisula International 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 Trisula International Tbk, you can compare the effects of market volatilities on Bank Mandiri and Trisula International 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 Trisula International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Trisula International.
Diversification Opportunities for Bank Mandiri and Trisula International
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bank and Trisula is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Trisula International Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trisula International Tbk 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 Trisula International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trisula International Tbk has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Trisula International go up and down completely randomly.
Pair Corralation between Bank Mandiri and Trisula International
Assuming the 90 days trading horizon Bank Mandiri Persero is expected to under-perform the Trisula International. In addition to that, Bank Mandiri is 2.09 times more volatile than Trisula International Tbk. It trades about -0.17 of its total potential returns per unit of risk. Trisula International Tbk is currently generating about -0.28 per unit of volatility. If you would invest 18,200 in Trisula International Tbk on September 1, 2024 and sell it today you would lose (1,200) from holding Trisula International Tbk or give up 6.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Bank Mandiri Persero vs. Trisula International Tbk
Performance |
| Timeline |
| Bank Mandiri Persero |
| Trisula International Tbk |
Bank Mandiri and Trisula International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and Trisula International
The main advantage of trading using opposite Bank Mandiri and Trisula International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Trisula International 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 Trisula International will offset losses from the drop in Trisula International'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 |
| Trisula International vs. PT Buana Artha | Trisula International vs. Tifico Fiber Indonesia | Trisula International vs. Voksel Electric Tbk | Trisula International vs. Sunson Textile Manufacturer |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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