Correlation Between BANK MANDIRI and London Stock
Can any of the company-specific risk be diversified away by investing in both BANK MANDIRI and London Stock 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 London Stock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BANK MANDIRI and London Stock Exchange, you can compare the effects of market volatilities on BANK MANDIRI and London Stock 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 London Stock. Check out your portfolio center. Please also check ongoing floating volatility patterns of BANK MANDIRI and London Stock.
Diversification Opportunities for BANK MANDIRI and London Stock
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BANK and London is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding BANK MANDIRI and London Stock Exchange in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on London Stock Exchange 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 London Stock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of London Stock Exchange has no effect on the direction of BANK MANDIRI i.e., BANK MANDIRI and London Stock go up and down completely randomly.
Pair Corralation between BANK MANDIRI and London Stock
Assuming the 90 days trading horizon BANK MANDIRI is expected to generate 7.79 times less return on investment than London Stock. In addition to that, BANK MANDIRI is 1.62 times more volatile than London Stock Exchange. It trades about 0.01 of its total potential returns per unit of risk. London Stock Exchange is currently generating about 0.16 per unit of volatility. If you would invest 13,000 in London Stock Exchange on September 13, 2024 and sell it today you would earn a total of 800.00 from holding London Stock Exchange or generate 6.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BANK MANDIRI vs. London Stock Exchange
Performance |
| Timeline |
| BANK MANDIRI |
| London Stock Exchange |
BANK MANDIRI and London Stock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BANK MANDIRI and London Stock
The main advantage of trading using opposite BANK MANDIRI and London Stock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BANK MANDIRI position performs unexpectedly, London Stock 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 London Stock will offset losses from the drop in London Stock's long position.| BANK MANDIRI vs. NXP Semiconductors NV | BANK MANDIRI vs. ON SEMICONDUCTOR | BANK MANDIRI vs. Arrow Electronics | BANK MANDIRI vs. STORE ELECTRONIC |
| London Stock vs. Caseys General Stores | London Stock vs. SCIENCE IN SPORT | London Stock vs. NTG Nordic Transport | London Stock vs. Burlington Stores |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| 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 |