Correlation Between Bank Mandiri and Hinto Energy
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Hinto Energy 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 Hinto Energy 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 Hinto Energy, you can compare the effects of market volatilities on Bank Mandiri and Hinto Energy 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 Hinto Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Hinto Energy.
Diversification Opportunities for Bank Mandiri and Hinto Energy
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and Hinto is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Hinto Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hinto Energy 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 Hinto Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hinto Energy has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Hinto Energy go up and down completely randomly.
Pair Corralation between Bank Mandiri and Hinto Energy
Assuming the 90 days horizon Bank Mandiri is expected to generate 1.92 times less return on investment than Hinto Energy. But when comparing it to its historical volatility, Bank Mandiri Persero is 2.9 times less risky than Hinto Energy. It trades about 0.02 of its potential returns per unit of risk. Hinto Energy is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 23.00 in Hinto Energy on November 30, 2024 and sell it today you would lose (21.65) from holding Hinto Energy or give up 94.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 75.75% |
| Values | Daily Returns |
Bank Mandiri Persero vs. Hinto Energy
Performance |
| Timeline |
| Bank Mandiri Persero |
| Hinto Energy |
Bank Mandiri and Hinto Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and Hinto Energy
The main advantage of trading using opposite Bank Mandiri and Hinto Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Hinto Energy 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 Hinto Energy will offset losses from the drop in Hinto Energy's long position.| Bank Mandiri vs. PT Bank Rakyat | Bank Mandiri vs. Piraeus Bank SA | Bank Mandiri vs. Eurobank Ergasias Services | Bank Mandiri vs. Zions Bancorporation |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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