Correlation Between Bank Mandiri and Qantas Airways
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Qantas Airways 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 Qantas Airways 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 Qantas Airways Limited, you can compare the effects of market volatilities on Bank Mandiri and Qantas Airways 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 Qantas Airways. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Qantas Airways.
Diversification Opportunities for Bank Mandiri and Qantas Airways
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and Qantas is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Qantas Airways Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qantas Airways 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 Qantas Airways. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qantas Airways has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Qantas Airways go up and down completely randomly.
Pair Corralation between Bank Mandiri and Qantas Airways
Assuming the 90 days horizon Bank Mandiri Persero is expected to under-perform the Qantas Airways. In addition to that, Bank Mandiri is 4.11 times more volatile than Qantas Airways Limited. It trades about -0.03 of its total potential returns per unit of risk. Qantas Airways Limited is currently generating about 0.05 per unit of volatility. If you would invest 535.00 in Qantas Airways Limited on September 1, 2024 and sell it today you would earn a total of 5.00 from holding Qantas Airways Limited or generate 0.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Mandiri Persero vs. Qantas Airways Limited
Performance |
| Timeline |
| Bank Mandiri Persero |
| Qantas Airways |
Bank Mandiri and Qantas Airways Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and Qantas Airways
The main advantage of trading using opposite Bank Mandiri and Qantas Airways positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Qantas Airways 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 Qantas Airways will offset losses from the drop in Qantas Airways' long position.| Bank Mandiri vs. Piraeus Bank SA | Bank Mandiri vs. Kasikornbank Public Co | Bank Mandiri vs. Turkiye Garanti Bankasi | Bank Mandiri vs. Delhi Bank Corp |
| Qantas Airways vs. Finnair Oyj | Qantas Airways vs. easyJet plc | Qantas Airways vs. Norse Atlantic ASA | Qantas Airways vs. Air New Zealand |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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