Correlation Between USU Software and BANK MANDIRI
Can any of the company-specific risk be diversified away by investing in both USU Software and BANK 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 USU Software and BANK MANDIRI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between USU Software AG and BANK MANDIRI, you can compare the effects of market volatilities on USU Software and BANK 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 USU Software with a short position of BANK MANDIRI. Check out your portfolio center. Please also check ongoing floating volatility patterns of USU Software and BANK MANDIRI.
Diversification Opportunities for USU Software and BANK MANDIRI
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between USU and BANK is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding USU Software AG and BANK MANDIRI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANK MANDIRI and USU Software 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 USU Software AG are associated (or correlated) with BANK MANDIRI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANK MANDIRI has no effect on the direction of USU Software i.e., USU Software and BANK MANDIRI go up and down completely randomly.
Pair Corralation between USU Software and BANK MANDIRI
Assuming the 90 days trading horizon USU Software AG is expected to generate 0.12 times more return on investment than BANK MANDIRI. However, USU Software AG is 8.11 times less risky than BANK MANDIRI. It trades about -0.25 of its potential returns per unit of risk. BANK MANDIRI is currently generating about -0.04 per unit of risk. If you would invest 2,260 in USU Software AG on October 11, 2024 and sell it today you would lose (100.00) from holding USU Software AG or give up 4.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
USU Software AG vs. BANK MANDIRI
Performance |
| Timeline |
| USU Software AG |
| BANK MANDIRI |
USU Software and BANK MANDIRI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with USU Software and BANK MANDIRI
The main advantage of trading using opposite USU Software and BANK MANDIRI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if USU Software position performs unexpectedly, BANK 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 BANK MANDIRI will offset losses from the drop in BANK MANDIRI's long position.| USU Software vs. Australian Agricultural | USU Software vs. Federal Agricultural Mortgage | USU Software vs. Nufarm Limited | USU Software vs. JAPAN TOBACCO UNSPADR12 |
| BANK MANDIRI vs. SENECA FOODS A | BANK MANDIRI vs. SPARTAN STORES | BANK MANDIRI vs. H2O Retailing | BANK MANDIRI vs. SCANSOURCE |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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