Correlation Between BANK MANDIRI and AURUBIS AG
Can any of the company-specific risk be diversified away by investing in both BANK MANDIRI and AURUBIS AG 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 AURUBIS AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BANK MANDIRI and AURUBIS AG UNSPADR, you can compare the effects of market volatilities on BANK MANDIRI and AURUBIS AG 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 AURUBIS AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of BANK MANDIRI and AURUBIS AG.
Diversification Opportunities for BANK MANDIRI and AURUBIS AG
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BANK and AURUBIS is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding BANK MANDIRI and AURUBIS AG UNSPADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AURUBIS AG UNSPADR 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 AURUBIS AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AURUBIS AG UNSPADR has no effect on the direction of BANK MANDIRI i.e., BANK MANDIRI and AURUBIS AG go up and down completely randomly.
Pair Corralation between BANK MANDIRI and AURUBIS AG
Assuming the 90 days trading horizon BANK MANDIRI is expected to under-perform the AURUBIS AG. But the stock apears to be less risky and, when comparing its historical volatility, BANK MANDIRI is 1.09 times less risky than AURUBIS AG. The stock trades about -0.16 of its potential returns per unit of risk. The AURUBIS AG UNSPADR is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 4,100 in AURUBIS AG UNSPADR on September 13, 2024 and sell it today you would lose (60.00) from holding AURUBIS AG UNSPADR or give up 1.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BANK MANDIRI vs. AURUBIS AG UNSPADR
Performance |
| Timeline |
| BANK MANDIRI |
| AURUBIS AG UNSPADR |
BANK MANDIRI and AURUBIS AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BANK MANDIRI and AURUBIS AG
The main advantage of trading using opposite BANK MANDIRI and AURUBIS AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BANK MANDIRI position performs unexpectedly, AURUBIS AG 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 AURUBIS AG will offset losses from the drop in AURUBIS AG's long position.| BANK MANDIRI vs. Apple Inc | BANK MANDIRI vs. Apple Inc | BANK MANDIRI vs. Apple Inc | BANK MANDIRI vs. Apple Inc |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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