Correlation Between Bank Mayapada and Bank Mega
Can any of the company-specific risk be diversified away by investing in both Bank Mayapada and Bank Mega 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 Mayapada and Bank Mega into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Mayapada Internasional and Bank Mega Tbk, you can compare the effects of market volatilities on Bank Mayapada and Bank Mega 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 Mayapada with a short position of Bank Mega. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mayapada and Bank Mega.
Diversification Opportunities for Bank Mayapada and Bank Mega
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and Bank is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mayapada Internasional and Bank Mega Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Mega Tbk and Bank Mayapada 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 Mayapada Internasional are associated (or correlated) with Bank Mega. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Mega Tbk has no effect on the direction of Bank Mayapada i.e., Bank Mayapada and Bank Mega go up and down completely randomly.
Pair Corralation between Bank Mayapada and Bank Mega
Assuming the 90 days trading horizon Bank Mayapada Internasional is expected to generate 9.26 times more return on investment than Bank Mega. However, Bank Mayapada is 9.26 times more volatile than Bank Mega Tbk. It trades about 0.09 of its potential returns per unit of risk. Bank Mega Tbk is currently generating about -0.14 per unit of risk. If you would invest 22,200 in Bank Mayapada Internasional on August 31, 2024 and sell it today you would earn a total of 2,400 from holding Bank Mayapada Internasional or generate 10.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Mayapada Internasional vs. Bank Mega Tbk
Performance |
| Timeline |
| Bank Mayapada Intern |
| Bank Mega Tbk |
Bank Mayapada and Bank Mega Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mayapada and Bank Mega
The main advantage of trading using opposite Bank Mayapada and Bank Mega positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mayapada position performs unexpectedly, Bank Mega 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 Mega will offset losses from the drop in Bank Mega's long position.| Bank Mayapada vs. Bank Mega Tbk | Bank Mayapada vs. Bank Ocbc Nisp | Bank Mayapada vs. Bank Windu Kentjana | Bank Mayapada vs. Bank Artha Graha |
| Bank Mega vs. Bank Ocbc Nisp | Bank Mega vs. Bank Mayapada Internasional | Bank Mega vs. Bank Permata Tbk | Bank Mega vs. Bank Pan Indonesia |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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