Correlation Between Bank Mandiri and Neptune Digital
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Neptune Digital 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 Neptune Digital 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 Neptune Digital Assets, you can compare the effects of market volatilities on Bank Mandiri and Neptune Digital 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 Neptune Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Neptune Digital.
Diversification Opportunities for Bank Mandiri and Neptune Digital
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and Neptune is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Neptune Digital Assets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neptune Digital Assets 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 Neptune Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neptune Digital Assets has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Neptune Digital go up and down completely randomly.
Pair Corralation between Bank Mandiri and Neptune Digital
Assuming the 90 days horizon Bank Mandiri is expected to generate 17.33 times less return on investment than Neptune Digital. But when comparing it to its historical volatility, Bank Mandiri Persero is 6.08 times less risky than Neptune Digital. It trades about 0.03 of its potential returns per unit of risk. Neptune Digital Assets is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 13.00 in Neptune Digital Assets on August 24, 2024 and sell it today you would earn a total of 43.00 from holding Neptune Digital Assets or generate 330.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Mandiri Persero vs. Neptune Digital Assets
Performance |
| Timeline |
| Bank Mandiri Persero |
| Neptune Digital Assets |
Bank Mandiri and Neptune Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and Neptune Digital
The main advantage of trading using opposite Bank Mandiri and Neptune Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Neptune Digital 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 Neptune Digital will offset losses from the drop in Neptune Digital's long position.| Bank Mandiri vs. Nedbank Group | Bank Mandiri vs. Standard Bank Group | Bank Mandiri vs. Bank Central Asia | Bank Mandiri vs. PSB Holdings |
| Neptune Digital vs. Morgan Stanley | Neptune Digital vs. Goldman Sachs Group | Neptune Digital vs. Charles Schwab Corp | Neptune Digital vs. Interactive Brokers Group |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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