Correlation Between BANK MANDIRI and MKS Instruments
Can any of the company-specific risk be diversified away by investing in both BANK MANDIRI and MKS Instruments 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 MKS Instruments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BANK MANDIRI and MKS Instruments, you can compare the effects of market volatilities on BANK MANDIRI and MKS Instruments 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 MKS Instruments. Check out your portfolio center. Please also check ongoing floating volatility patterns of BANK MANDIRI and MKS Instruments.
Diversification Opportunities for BANK MANDIRI and MKS Instruments
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BANK and MKS is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding BANK MANDIRI and MKS Instruments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MKS Instruments 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 are associated (or correlated) with MKS Instruments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MKS Instruments has no effect on the direction of BANK MANDIRI i.e., BANK MANDIRI and MKS Instruments go up and down completely randomly.
Pair Corralation between BANK MANDIRI and MKS Instruments
Assuming the 90 days trading horizon BANK MANDIRI is expected to generate 0.93 times more return on investment than MKS Instruments. However, BANK MANDIRI is 1.08 times less risky than MKS Instruments. It trades about 0.01 of its potential returns per unit of risk. MKS Instruments is currently generating about -0.06 per unit of risk. If you would invest 35.00 in BANK MANDIRI on September 12, 2024 and sell it today you would earn a total of 0.00 from holding BANK MANDIRI or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
BANK MANDIRI vs. MKS Instruments
Performance |
| Timeline |
| BANK MANDIRI |
| MKS Instruments |
BANK MANDIRI and MKS Instruments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BANK MANDIRI and MKS Instruments
The main advantage of trading using opposite BANK MANDIRI and MKS Instruments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BANK MANDIRI position performs unexpectedly, MKS Instruments 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 MKS Instruments will offset losses from the drop in MKS Instruments' long position.| BANK MANDIRI vs. NURAN WIRELESS INC | BANK MANDIRI vs. Summit Hotel Properties | BANK MANDIRI vs. KENEDIX OFFICE INV | BANK MANDIRI vs. Pebblebrook Hotel Trust |
| MKS Instruments vs. HEXAGON AB ADR1 | MKS Instruments vs. Superior Plus Corp | MKS Instruments vs. SIVERS SEMICONDUCTORS AB | MKS Instruments vs. NorAm Drilling AS |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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