Correlation Between Bank Windu and Bank Mayapada
Can any of the company-specific risk be diversified away by investing in both Bank Windu and Bank Mayapada 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 Windu and Bank Mayapada into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Windu Kentjana and Bank Mayapada Internasional, you can compare the effects of market volatilities on Bank Windu and Bank Mayapada 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 Windu with a short position of Bank Mayapada. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Windu and Bank Mayapada.
Diversification Opportunities for Bank Windu and Bank Mayapada
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Bank and Bank is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Bank Windu Kentjana and Bank Mayapada Internasional in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Mayapada Intern and Bank Windu 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 Windu Kentjana are associated (or correlated) with Bank Mayapada. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Mayapada Intern has no effect on the direction of Bank Windu i.e., Bank Windu and Bank Mayapada go up and down completely randomly.
Pair Corralation between Bank Windu and Bank Mayapada
Assuming the 90 days trading horizon Bank Windu Kentjana is expected to under-perform the Bank Mayapada. But the stock apears to be less risky and, when comparing its historical volatility, Bank Windu Kentjana is 2.79 times less risky than Bank Mayapada. The stock trades about -0.09 of its potential returns per unit of risk. The Bank Mayapada Internasional is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 22,600 in Bank Mayapada Internasional on October 24, 2024 and sell it today you would lose (1,800) from holding Bank Mayapada Internasional or give up 7.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Windu Kentjana vs. Bank Mayapada Internasional
Performance |
| Timeline |
| Bank Windu Kentjana |
| Bank Mayapada Intern |
Bank Windu and Bank Mayapada Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Windu and Bank Mayapada
The main advantage of trading using opposite Bank Windu and Bank Mayapada positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Windu position performs unexpectedly, Bank Mayapada 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 Mayapada will offset losses from the drop in Bank Mayapada's long position.| Bank Windu vs. Bank Mayapada Internasional | Bank Windu vs. Bank Artha Graha | Bank Windu vs. Bank Pembangunan Daerah | Bank Windu vs. Bank Mega Tbk |
| Bank Mayapada vs. Bank Mega Tbk | Bank Mayapada vs. Bank Ocbc Nisp | Bank Mayapada vs. Bank Windu Kentjana | Bank Mayapada vs. Bank Artha Graha |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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