Correlation Between Bank Mandiri and HomeStreet
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and HomeStreet 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 HomeStreet 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 HomeStreet, you can compare the effects of market volatilities on Bank Mandiri and HomeStreet 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 HomeStreet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and HomeStreet.
Diversification Opportunities for Bank Mandiri and HomeStreet
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Bank and HomeStreet is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and HomeStreet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HomeStreet 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 HomeStreet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HomeStreet has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and HomeStreet go up and down completely randomly.
Pair Corralation between Bank Mandiri and HomeStreet
Assuming the 90 days horizon Bank Mandiri Persero is expected to generate 0.37 times more return on investment than HomeStreet. However, Bank Mandiri Persero is 2.72 times less risky than HomeStreet. It trades about 0.02 of its potential returns per unit of risk. HomeStreet is currently generating about -0.01 per unit of risk. If you would invest 1,294 in Bank Mandiri Persero on November 2, 2024 and sell it today you would earn a total of 193.00 from holding Bank Mandiri Persero or generate 14.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Mandiri Persero vs. HomeStreet
Performance |
| Timeline |
| Bank Mandiri Persero |
| HomeStreet |
Bank Mandiri and HomeStreet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and HomeStreet
The main advantage of trading using opposite Bank Mandiri and HomeStreet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, HomeStreet 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 HomeStreet will offset losses from the drop in HomeStreet's long position.| Bank Mandiri vs. Bank Rakyat | Bank Mandiri vs. Eurobank Ergasias Services | Bank Mandiri vs. Nedbank Group | Bank Mandiri vs. Standard Bank Group |
| HomeStreet vs. Heartland Financial USA | HomeStreet vs. Heritage Commerce Corp | HomeStreet vs. Business First Bancshares | HomeStreet vs. German American Bancorp |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |