Correlation Between Bank Mandiri and Genesis Growth
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Genesis Growth 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 Mandiri and Genesis Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Mandiri Persero and Genesis Growth Tech, you can compare the effects of market volatilities on Bank Mandiri and Genesis Growth 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 Mandiri with a short position of Genesis Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Genesis Growth.
Diversification Opportunities for Bank Mandiri and Genesis Growth
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and Genesis is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Genesis Growth Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genesis Growth Tech and Bank Mandiri 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 Mandiri Persero are associated (or correlated) with Genesis Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genesis Growth Tech has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Genesis Growth go up and down completely randomly.
Pair Corralation between Bank Mandiri and Genesis Growth
If you would invest 2,157 in Genesis Growth Tech on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Genesis Growth Tech or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
Bank Mandiri Persero vs. Genesis Growth Tech
Performance |
| Timeline |
| Bank Mandiri Persero |
| Genesis Growth Tech |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Bank Mandiri and Genesis Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and Genesis Growth
The main advantage of trading using opposite Bank Mandiri and Genesis Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Genesis Growth 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 Genesis Growth will offset losses from the drop in Genesis Growth's long position.The idea behind Bank Mandiri Persero and Genesis Growth Tech pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Global Correlations module to find global opportunities by holding instruments from different markets.
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