Correlation Between Bank Mandiri and Guided Therapeutics
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Guided Therapeutics 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 Guided Therapeutics 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 Guided Therapeutics, you can compare the effects of market volatilities on Bank Mandiri and Guided Therapeutics 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 Guided Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Guided Therapeutics.
Diversification Opportunities for Bank Mandiri and Guided Therapeutics
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and Guided is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Guided Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guided Therapeutics 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 Guided Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guided Therapeutics has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Guided Therapeutics go up and down completely randomly.
Pair Corralation between Bank Mandiri and Guided Therapeutics
Assuming the 90 days horizon Bank Mandiri Persero is expected to under-perform the Guided Therapeutics. But the pink sheet apears to be less risky and, when comparing its historical volatility, Bank Mandiri Persero is 2.05 times less risky than Guided Therapeutics. The pink sheet trades about -0.02 of its potential returns per unit of risk. The Guided Therapeutics is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 18.00 in Guided Therapeutics on September 13, 2024 and sell it today you would lose (1.00) from holding Guided Therapeutics or give up 5.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Mandiri Persero vs. Guided Therapeutics
Performance |
| Timeline |
| Bank Mandiri Persero |
| Guided Therapeutics |
Bank Mandiri and Guided Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and Guided Therapeutics
The main advantage of trading using opposite Bank Mandiri and Guided Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Guided Therapeutics 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 Guided Therapeutics will offset losses from the drop in Guided Therapeutics' long position.| Bank Mandiri vs. PT Bank Rakyat | Bank Mandiri vs. Morningstar Unconstrained Allocation | Bank Mandiri vs. Bondbloxx ETF Trust | Bank Mandiri vs. Spring Valley Acquisition |
| Guided Therapeutics vs. Nephros | Guided Therapeutics vs. Intelgenx Technologs | Guided Therapeutics vs. SANUWAVE Health | Guided Therapeutics vs. Spectrascience New |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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