Correlation Between Bank Mandiri and Big Ridge
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Big Ridge 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 Big Ridge 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 Big Ridge Gold, you can compare the effects of market volatilities on Bank Mandiri and Big Ridge 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 Big Ridge. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Big Ridge.
Diversification Opportunities for Bank Mandiri and Big Ridge
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and Big is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Big Ridge Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Big Ridge Gold 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 Big Ridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Big Ridge Gold has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Big Ridge go up and down completely randomly.
Pair Corralation between Bank Mandiri and Big Ridge
Assuming the 90 days horizon Bank Mandiri Persero is expected to generate 0.35 times more return on investment than Big Ridge. However, Bank Mandiri Persero is 2.85 times less risky than Big Ridge. It trades about -0.1 of its potential returns per unit of risk. Big Ridge Gold is currently generating about -0.08 per unit of risk. If you would invest 1,742 in Bank Mandiri Persero on August 29, 2024 and sell it today you would lose (92.00) from holding Bank Mandiri Persero or give up 5.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Bank Mandiri Persero vs. Big Ridge Gold
Performance |
| Timeline |
| Bank Mandiri Persero |
| Big Ridge Gold |
Bank Mandiri and Big Ridge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and Big Ridge
The main advantage of trading using opposite Bank Mandiri and Big Ridge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Big Ridge 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 Big Ridge will offset losses from the drop in Big Ridge's long position.| Bank Mandiri vs. Israel Discount Bank | Bank Mandiri vs. Baraboo Bancorporation | Bank Mandiri vs. Danske Bank AS | Bank Mandiri vs. Jyske Bank AS |
| Big Ridge vs. Vertiv Holdings Co | Big Ridge vs. Nasdaq Inc | Big Ridge vs. McDonalds | Big Ridge vs. Walmart |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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