Correlation Between Playa Hotels and BANK MANDIRI
Can any of the company-specific risk be diversified away by investing in both Playa Hotels 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 Playa Hotels and BANK MANDIRI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Playa Hotels Resorts and BANK MANDIRI, you can compare the effects of market volatilities on Playa Hotels 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 Playa Hotels with a short position of BANK MANDIRI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playa Hotels and BANK MANDIRI.
Diversification Opportunities for Playa Hotels and BANK MANDIRI
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Playa and BANK is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Playa Hotels Resorts and BANK MANDIRI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANK MANDIRI and Playa Hotels 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 Playa Hotels Resorts 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 Playa Hotels i.e., Playa Hotels and BANK MANDIRI go up and down completely randomly.
Pair Corralation between Playa Hotels and BANK MANDIRI
Assuming the 90 days horizon Playa Hotels Resorts is expected to generate 0.55 times more return on investment than BANK MANDIRI. However, Playa Hotels Resorts is 1.83 times less risky than BANK MANDIRI. It trades about 0.06 of its potential returns per unit of risk. BANK MANDIRI is currently generating about 0.02 per unit of risk. If you would invest 655.00 in Playa Hotels Resorts on October 16, 2024 and sell it today you would earn a total of 535.00 from holding Playa Hotels Resorts or generate 81.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Playa Hotels Resorts vs. BANK MANDIRI
Performance |
| Timeline |
| Playa Hotels Resorts |
| BANK MANDIRI |
Playa Hotels and BANK MANDIRI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Playa Hotels and BANK MANDIRI
The main advantage of trading using opposite Playa Hotels and BANK MANDIRI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playa Hotels 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.| Playa Hotels vs. ecotel communication ag | Playa Hotels vs. Highlight Communications AG | Playa Hotels vs. Cairo Communication SpA | Playa Hotels vs. Ribbon Communications |
| BANK MANDIRI vs. JAPAN AIRLINES | BANK MANDIRI vs. Playa Hotels Resorts | BANK MANDIRI vs. ANTA SPORTS PRODUCT | BANK MANDIRI vs. PLAYSTUDIOS A DL 0001 |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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