Correlation Between Bank Mandiri and Nmb Financial
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Nmb Financial 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 Nmb Financial 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 Nmb Financial Corp, you can compare the effects of market volatilities on Bank Mandiri and Nmb Financial 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 Nmb Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Nmb Financial.
Diversification Opportunities for Bank Mandiri and Nmb Financial
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and Nmb is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Nmb Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nmb Financial 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 Nmb Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nmb Financial Corp has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Nmb Financial go up and down completely randomly.
Pair Corralation between Bank Mandiri and Nmb Financial
Assuming the 90 days horizon Bank Mandiri Persero is expected to under-perform the Nmb Financial. In addition to that, Bank Mandiri is 2.64 times more volatile than Nmb Financial Corp. It trades about -0.02 of its total potential returns per unit of risk. Nmb Financial Corp is currently generating about 0.33 per unit of volatility. If you would invest 1,026 in Nmb Financial Corp on September 2, 2024 and sell it today you would earn a total of 374.00 from holding Nmb Financial Corp or generate 36.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 98.46% |
| Values | Daily Returns |
Bank Mandiri Persero vs. Nmb Financial Corp
Performance |
| Timeline |
| Bank Mandiri Persero |
| Nmb Financial Corp |
Bank Mandiri and Nmb Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and Nmb Financial
The main advantage of trading using opposite Bank Mandiri and Nmb Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Nmb Financial 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 Nmb Financial will offset losses from the drop in Nmb Financial's long position.| Bank Mandiri vs. Piraeus Bank SA | Bank Mandiri vs. Turkiye Garanti Bankasi | Bank Mandiri vs. Uwharrie Capital Corp |
| Nmb Financial vs. Piraeus Bank SA | Nmb Financial vs. Turkiye Garanti Bankasi | Nmb Financial vs. Uwharrie Capital Corp |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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