Correlation Between Bank Mandiri and Niagara Mohawk
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Niagara Mohawk 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 Niagara Mohawk 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 Niagara Mohawk Power, you can compare the effects of market volatilities on Bank Mandiri and Niagara Mohawk 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 Niagara Mohawk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Niagara Mohawk.
Diversification Opportunities for Bank Mandiri and Niagara Mohawk
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and Niagara is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Niagara Mohawk Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Niagara Mohawk Power 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 Niagara Mohawk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Niagara Mohawk Power has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Niagara Mohawk go up and down completely randomly.
Pair Corralation between Bank Mandiri and Niagara Mohawk
Assuming the 90 days horizon Bank Mandiri Persero is expected to generate 6.12 times more return on investment than Niagara Mohawk. However, Bank Mandiri is 6.12 times more volatile than Niagara Mohawk Power. It trades about 0.06 of its potential returns per unit of risk. Niagara Mohawk Power is currently generating about 0.02 per unit of risk. If you would invest 30.00 in Bank Mandiri Persero on September 3, 2024 and sell it today you would earn a total of 13.00 from holding Bank Mandiri Persero or generate 43.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 67.93% |
| Values | Daily Returns |
Bank Mandiri Persero vs. Niagara Mohawk Power
Performance |
| Timeline |
| Bank Mandiri Persero |
| Niagara Mohawk Power |
Bank Mandiri and Niagara Mohawk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and Niagara Mohawk
The main advantage of trading using opposite Bank Mandiri and Niagara Mohawk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Niagara Mohawk 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 Niagara Mohawk will offset losses from the drop in Niagara Mohawk'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 |
| Niagara Mohawk vs. Apple Inc | Niagara Mohawk vs. Microsoft | Niagara Mohawk vs. Amazon Inc | Niagara Mohawk vs. Alphabet Inc Class C |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |