Correlation Between Nanotech Indonesia and PT Mandiri
Can any of the company-specific risk be diversified away by investing in both Nanotech Indonesia and PT 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 Nanotech Indonesia and PT Mandiri into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nanotech Indonesia Global and PT Mandiri Herindo, you can compare the effects of market volatilities on Nanotech Indonesia and PT 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 Nanotech Indonesia with a short position of PT Mandiri. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanotech Indonesia and PT Mandiri.
Diversification Opportunities for Nanotech Indonesia and PT Mandiri
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Nanotech and MAHA is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Nanotech Indonesia Global and PT Mandiri Herindo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Mandiri Herindo and Nanotech Indonesia 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 Nanotech Indonesia Global are associated (or correlated) with PT Mandiri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Mandiri Herindo has no effect on the direction of Nanotech Indonesia i.e., Nanotech Indonesia and PT Mandiri go up and down completely randomly.
Pair Corralation between Nanotech Indonesia and PT Mandiri
Assuming the 90 days trading horizon Nanotech Indonesia Global is expected to generate 2.07 times more return on investment than PT Mandiri. However, Nanotech Indonesia is 2.07 times more volatile than PT Mandiri Herindo. It trades about 0.11 of its potential returns per unit of risk. PT Mandiri Herindo is currently generating about -0.11 per unit of risk. If you would invest 1,400 in Nanotech Indonesia Global on August 30, 2024 and sell it today you would earn a total of 800.00 from holding Nanotech Indonesia Global or generate 57.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanotech Indonesia Global vs. PT Mandiri Herindo
Performance |
| Timeline |
| Nanotech Indonesia Global |
| PT Mandiri Herindo |
Nanotech Indonesia and PT Mandiri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanotech Indonesia and PT Mandiri
The main advantage of trading using opposite Nanotech Indonesia and PT Mandiri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanotech Indonesia position performs unexpectedly, PT 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 PT Mandiri will offset losses from the drop in PT Mandiri's long position.| Nanotech Indonesia vs. Sumber Tani Agung | Nanotech Indonesia vs. Dayamitra Telekomunikasi PT | Nanotech Indonesia vs. Wahana Inti MakmurTbk | Nanotech Indonesia vs. Wir Asia Tbk |
| PT Mandiri vs. Weha Transportasi Indonesia | PT Mandiri vs. Nanotech Indonesia Global | PT Mandiri vs. PT Jobubu Jarum | PT Mandiri vs. Indonesian Tobacco 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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