Correlation Between Bank Mandiri and Telecom Italia
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Telecom Italia 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 Telecom Italia 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 Telecom Italia SpA, you can compare the effects of market volatilities on Bank Mandiri and Telecom Italia 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 Telecom Italia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Telecom Italia.
Diversification Opportunities for Bank Mandiri and Telecom Italia
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and Telecom is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Telecom Italia SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telecom Italia SpA 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 Telecom Italia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telecom Italia SpA has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Telecom Italia go up and down completely randomly.
Pair Corralation between Bank Mandiri and Telecom Italia
If you would invest 28.00 in Telecom Italia SpA on September 1, 2024 and sell it today you would earn a total of 0.00 from holding Telecom Italia SpA or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Bank Mandiri Persero vs. Telecom Italia SpA
Performance |
| Timeline |
| Bank Mandiri Persero |
| Telecom Italia SpA |
Bank Mandiri and Telecom Italia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and Telecom Italia
The main advantage of trading using opposite Bank Mandiri and Telecom Italia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Telecom Italia 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 Telecom Italia will offset losses from the drop in Telecom Italia's long position.| Bank Mandiri vs. Piraeus Bank SA | Bank Mandiri vs. Turkiye Garanti Bankasi | Bank Mandiri vs. Delhi Bank Corp | Bank Mandiri vs. Uwharrie Capital Corp |
| Telecom Italia vs. Liberty Broadband Srs | Telecom Italia vs. Cogent Communications Group | Telecom Italia vs. Charter Communications | Telecom Italia vs. Liberty Broadband Srs |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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