Correlation Between Bank Ocbc and Mnc Kapital
Can any of the company-specific risk be diversified away by investing in both Bank Ocbc and Mnc Kapital 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 Ocbc and Mnc Kapital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Ocbc Nisp and Mnc Kapital Indonesia, you can compare the effects of market volatilities on Bank Ocbc and Mnc Kapital 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 Ocbc with a short position of Mnc Kapital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Ocbc and Mnc Kapital.
Diversification Opportunities for Bank Ocbc and Mnc Kapital
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bank and Mnc is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Bank Ocbc Nisp and Mnc Kapital Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mnc Kapital Indonesia and Bank Ocbc 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 Ocbc Nisp are associated (or correlated) with Mnc Kapital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mnc Kapital Indonesia has no effect on the direction of Bank Ocbc i.e., Bank Ocbc and Mnc Kapital go up and down completely randomly.
Pair Corralation between Bank Ocbc and Mnc Kapital
Assuming the 90 days trading horizon Bank Ocbc Nisp is expected to generate 0.13 times more return on investment than Mnc Kapital. However, Bank Ocbc Nisp is 7.53 times less risky than Mnc Kapital. It trades about -0.19 of its potential returns per unit of risk. Mnc Kapital Indonesia is currently generating about -0.19 per unit of risk. If you would invest 137,000 in Bank Ocbc Nisp on September 1, 2024 and sell it today you would lose (3,500) from holding Bank Ocbc Nisp or give up 2.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Bank Ocbc Nisp vs. Mnc Kapital Indonesia
Performance |
| Timeline |
| Bank Ocbc Nisp |
| Mnc Kapital Indonesia |
Bank Ocbc and Mnc Kapital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Ocbc and Mnc Kapital
The main advantage of trading using opposite Bank Ocbc and Mnc Kapital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Ocbc position performs unexpectedly, Mnc Kapital 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 Mnc Kapital will offset losses from the drop in Mnc Kapital's long position.| Bank Ocbc vs. Bank Mega Tbk | Bank Ocbc vs. Bank Pan Indonesia | Bank Ocbc vs. Bank Permata Tbk | Bank Ocbc vs. Bank Cimb Niaga |
| Mnc Kapital vs. Diamond Food Indonesia | Mnc Kapital vs. Sentra Food Indonesia | Mnc Kapital vs. Garuda Metalindo Tbk | Mnc Kapital vs. Lion Metal Works |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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