Correlation Between Bank Mandiri and Tourmaline Oil
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Tourmaline Oil 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 Tourmaline Oil 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 Tourmaline Oil Corp, you can compare the effects of market volatilities on Bank Mandiri and Tourmaline Oil 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 Tourmaline Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Tourmaline Oil.
Diversification Opportunities for Bank Mandiri and Tourmaline Oil
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and Tourmaline is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Tourmaline Oil Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tourmaline Oil Corp 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 Tourmaline Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tourmaline Oil Corp has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Tourmaline Oil go up and down completely randomly.
Pair Corralation between Bank Mandiri and Tourmaline Oil
Assuming the 90 days horizon Bank Mandiri Persero is expected to generate 0.93 times more return on investment than Tourmaline Oil. However, Bank Mandiri Persero is 1.07 times less risky than Tourmaline Oil. It trades about 0.04 of its potential returns per unit of risk. Tourmaline Oil Corp is currently generating about 0.01 per unit of risk. If you would invest 1,210 in Bank Mandiri Persero on August 30, 2024 and sell it today you would earn a total of 440.00 from holding Bank Mandiri Persero or generate 36.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Mandiri Persero vs. Tourmaline Oil Corp
Performance |
| Timeline |
| Bank Mandiri Persero |
| Tourmaline Oil Corp |
Bank Mandiri and Tourmaline Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and Tourmaline Oil
The main advantage of trading using opposite Bank Mandiri and Tourmaline Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Tourmaline Oil 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 Tourmaline Oil will offset losses from the drop in Tourmaline Oil'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 |
| Tourmaline Oil vs. PrairieSky Royalty | Tourmaline Oil vs. Tamarack Valley Energy | Tourmaline Oil vs. MEG Energy Corp | Tourmaline Oil vs. Cardinal Energy |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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