Correlation Between Bank Mandiri and Dream Industrial
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Dream Industrial 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 Dream Industrial 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 Dream Industrial Real, you can compare the effects of market volatilities on Bank Mandiri and Dream Industrial 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 Dream Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Dream Industrial.
Diversification Opportunities for Bank Mandiri and Dream Industrial
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Bank and Dream is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Dream Industrial Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dream Industrial Real 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 Dream Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dream Industrial Real has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Dream Industrial go up and down completely randomly.
Pair Corralation between Bank Mandiri and Dream Industrial
Assuming the 90 days horizon Bank Mandiri Persero is expected to under-perform the Dream Industrial. In addition to that, Bank Mandiri is 1.86 times more volatile than Dream Industrial Real. It trades about -0.23 of its total potential returns per unit of risk. Dream Industrial Real is currently generating about -0.4 per unit of volatility. If you would invest 915.00 in Dream Industrial Real on September 22, 2024 and sell it today you would lose (104.00) from holding Dream Industrial Real or give up 11.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Mandiri Persero vs. Dream Industrial Real
Performance |
| Timeline |
| Bank Mandiri Persero |
| Dream Industrial Real |
Bank Mandiri and Dream Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and Dream Industrial
The main advantage of trading using opposite Bank Mandiri and Dream Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Dream Industrial 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 Dream Industrial will offset losses from the drop in Dream Industrial's long position.| Bank Mandiri vs. Morningstar Unconstrained Allocation | Bank Mandiri vs. Bondbloxx ETF Trust | Bank Mandiri vs. Spring Valley Acquisition | Bank Mandiri vs. Bondbloxx ETF Trust |
| Dream Industrial vs. Ashford Hospitality Trust | Dream Industrial vs. Ashford Hospitality Trust | Dream Industrial vs. Braemar Hotels Resorts | Dream Industrial vs. Braemar Hotels Resorts |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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