Correlation Between Bank Mandiri and MNB Holdings
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and MNB Holdings 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 MNB Holdings 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 MNB Holdings Corp, you can compare the effects of market volatilities on Bank Mandiri and MNB Holdings 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 MNB Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and MNB Holdings.
Diversification Opportunities for Bank Mandiri and MNB Holdings
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bank and MNB is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and MNB Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MNB Holdings Corp 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 MNB Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MNB Holdings Corp has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and MNB Holdings go up and down completely randomly.
Pair Corralation between Bank Mandiri and MNB Holdings
Assuming the 90 days horizon Bank Mandiri Persero is expected to under-perform the MNB Holdings. In addition to that, Bank Mandiri is 5.49 times more volatile than MNB Holdings Corp. It trades about -0.03 of its total potential returns per unit of risk. MNB Holdings Corp is currently generating about -0.06 per unit of volatility. If you would invest 2,400 in MNB Holdings Corp on September 2, 2024 and sell it today you would lose (25.00) from holding MNB Holdings Corp or give up 1.04% 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. MNB Holdings Corp
Performance |
| Timeline |
| Bank Mandiri Persero |
| MNB Holdings Corp |
Bank Mandiri and MNB Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and MNB Holdings
The main advantage of trading using opposite Bank Mandiri and MNB Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, MNB Holdings 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 MNB Holdings will offset losses from the drop in MNB Holdings' long position.| Bank Mandiri vs. Piraeus Bank SA | Bank Mandiri vs. Turkiye Garanti Bankasi | Bank Mandiri vs. Uwharrie Capital Corp |
| MNB Holdings vs. Harbor Bankshares | MNB Holdings vs. Oconee Financial | MNB Holdings vs. Mission Valley Bancorp | MNB Holdings vs. MF Bancorp |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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