Correlation Between Bank Mayapada and Bank Woori
Can any of the company-specific risk be diversified away by investing in both Bank Mayapada and Bank Woori 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 Woori 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 Woori Saudara, you can compare the effects of market volatilities on Bank Mayapada and Bank Woori 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 Woori. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mayapada and Bank Woori.
Diversification Opportunities for Bank Mayapada and Bank Woori
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and Bank is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mayapada Internasional and Bank Woori Saudara in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Woori Saudara 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 Woori. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Woori Saudara has no effect on the direction of Bank Mayapada i.e., Bank Mayapada and Bank Woori go up and down completely randomly.
Pair Corralation between Bank Mayapada and Bank Woori
Assuming the 90 days trading horizon Bank Mayapada Internasional is expected to under-perform the Bank Woori. In addition to that, Bank Mayapada is 1.06 times more volatile than Bank Woori Saudara. It trades about -0.48 of its total potential returns per unit of risk. Bank Woori Saudara is currently generating about -0.44 per unit of volatility. If you would invest 46,400 in Bank Woori Saudara on August 27, 2024 and sell it today you would lose (4,000) from holding Bank Woori Saudara or give up 8.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Mayapada Internasional vs. Bank Woori Saudara
Performance |
| Timeline |
| Bank Mayapada Intern |
| Bank Woori Saudara |
Bank Mayapada and Bank Woori Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mayapada and Bank Woori
The main advantage of trading using opposite Bank Mayapada and Bank Woori positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mayapada position performs unexpectedly, Bank Woori 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 Woori will offset losses from the drop in Bank Woori'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 Woori vs. Bank Ocbc Nisp | Bank Woori vs. Bank Pan Indonesia | Bank Woori vs. Bank Mega Tbk | Bank Woori vs. Bank Mayapada Internasional |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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