Correlation Between Jasa Marga and Bank Mandiri
Can any of the company-specific risk be diversified away by investing in both Jasa Marga and Bank Mandiri 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 Jasa Marga and Bank Mandiri into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jasa Marga Tbk and Bank Mandiri Persero, you can compare the effects of market volatilities on Jasa Marga and Bank Mandiri 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 Jasa Marga with a short position of Bank Mandiri. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jasa Marga and Bank Mandiri.
Diversification Opportunities for Jasa Marga and Bank Mandiri
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jasa and Bank is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Jasa Marga Tbk and Bank Mandiri Persero in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Mandiri Persero and Jasa Marga 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 Jasa Marga Tbk are associated (or correlated) with Bank Mandiri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Mandiri Persero has no effect on the direction of Jasa Marga i.e., Jasa Marga and Bank Mandiri go up and down completely randomly.
Pair Corralation between Jasa Marga and Bank Mandiri
Assuming the 90 days trading horizon Jasa Marga Tbk is expected to generate 0.61 times more return on investment than Bank Mandiri. However, Jasa Marga Tbk is 1.64 times less risky than Bank Mandiri. It trades about 0.02 of its potential returns per unit of risk. Bank Mandiri Persero is currently generating about -0.12 per unit of risk. If you would invest 468,000 in Jasa Marga Tbk on August 29, 2024 and sell it today you would earn a total of 2,000 from holding Jasa Marga Tbk or generate 0.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jasa Marga Tbk vs. Bank Mandiri Persero
Performance |
| Timeline |
| Jasa Marga Tbk |
| Bank Mandiri Persero |
Jasa Marga and Bank Mandiri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jasa Marga and Bank Mandiri
The main advantage of trading using opposite Jasa Marga and Bank Mandiri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jasa Marga position performs unexpectedly, Bank Mandiri 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 Bank Mandiri will offset losses from the drop in Bank Mandiri's long position.| Jasa Marga vs. Semen Indonesia Persero | Jasa Marga vs. Wijaya Karya Beton | Jasa Marga vs. Perusahaan Gas Negara | Jasa Marga vs. PT Indofood Sukses |
| Bank Mandiri vs. Bank Rakyat Indonesia | Bank Mandiri vs. Bank Central Asia | Bank Mandiri vs. Bank Negara Indonesia | Bank Mandiri vs. Astra International 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 Stocks Directory module to find actively traded stocks across global markets.
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