Correlation Between Bank Mandiri and FP Newspapers
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and FP Newspapers 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 FP Newspapers 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 FP Newspapers, you can compare the effects of market volatilities on Bank Mandiri and FP Newspapers 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 FP Newspapers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and FP Newspapers.
Diversification Opportunities for Bank Mandiri and FP Newspapers
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and FPNUF is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and FP Newspapers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FP Newspapers 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 FP Newspapers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FP Newspapers has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and FP Newspapers go up and down completely randomly.
Pair Corralation between Bank Mandiri and FP Newspapers
Assuming the 90 days horizon Bank Mandiri Persero is expected to generate 1.08 times more return on investment than FP Newspapers. However, Bank Mandiri is 1.08 times more volatile than FP Newspapers. It trades about 0.0 of its potential returns per unit of risk. FP Newspapers is currently generating about -0.05 per unit of risk. If you would invest 1,287 in Bank Mandiri Persero on November 28, 2024 and sell it today you would lose (94.00) from holding Bank Mandiri Persero or give up 7.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Mandiri Persero vs. FP Newspapers
Performance |
| Timeline |
| Bank Mandiri Persero |
| FP Newspapers |
Bank Mandiri and FP Newspapers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and FP Newspapers
The main advantage of trading using opposite Bank Mandiri and FP Newspapers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, FP Newspapers 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 FP Newspapers will offset losses from the drop in FP Newspapers' long position.| Bank Mandiri vs. Bank Rakyat | Bank Mandiri vs. Eurobank Ergasias Services | Bank Mandiri vs. Nedbank Group | Bank Mandiri vs. Standard Bank Group |
| FP Newspapers vs. Uber Technologies | FP Newspapers vs. NetEase | FP Newspapers vs. Sphere 3D Corp | FP Newspapers vs. Paranovus Entertainment Technology |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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