Correlation Between STRAYER EDUCATION and BANK MANDIRI
Can any of the company-specific risk be diversified away by investing in both STRAYER EDUCATION and BANK MANDIRI 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 STRAYER EDUCATION and BANK MANDIRI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between STRAYER EDUCATION and BANK MANDIRI, you can compare the effects of market volatilities on STRAYER EDUCATION and BANK MANDIRI 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 STRAYER EDUCATION with a short position of BANK MANDIRI. Check out your portfolio center. Please also check ongoing floating volatility patterns of STRAYER EDUCATION and BANK MANDIRI.
Diversification Opportunities for STRAYER EDUCATION and BANK MANDIRI
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between STRAYER and BANK is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding STRAYER EDUCATION and BANK MANDIRI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANK MANDIRI and STRAYER EDUCATION 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 STRAYER EDUCATION are associated (or correlated) with BANK MANDIRI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANK MANDIRI has no effect on the direction of STRAYER EDUCATION i.e., STRAYER EDUCATION and BANK MANDIRI go up and down completely randomly.
Pair Corralation between STRAYER EDUCATION and BANK MANDIRI
Assuming the 90 days trading horizon STRAYER EDUCATION is expected to generate 1.26 times less return on investment than BANK MANDIRI. But when comparing it to its historical volatility, STRAYER EDUCATION is 1.94 times less risky than BANK MANDIRI. It trades about 0.03 of its potential returns per unit of risk. BANK MANDIRI is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 31.00 in BANK MANDIRI on August 24, 2024 and sell it today you would earn a total of 2.00 from holding BANK MANDIRI or generate 6.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
STRAYER EDUCATION vs. BANK MANDIRI
Performance |
| Timeline |
| STRAYER EDUCATION |
| BANK MANDIRI |
STRAYER EDUCATION and BANK MANDIRI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STRAYER EDUCATION and BANK MANDIRI
The main advantage of trading using opposite STRAYER EDUCATION and BANK MANDIRI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STRAYER EDUCATION position performs unexpectedly, BANK MANDIRI 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 BANK MANDIRI will offset losses from the drop in BANK MANDIRI's long position.| STRAYER EDUCATION vs. Apple Inc | STRAYER EDUCATION vs. Apple Inc | STRAYER EDUCATION vs. Apple Inc | STRAYER EDUCATION vs. Apple Inc |
| BANK MANDIRI vs. EMBARK EDUCATION LTD | BANK MANDIRI vs. STRAYER EDUCATION | BANK MANDIRI vs. DeVry Education Group | BANK MANDIRI vs. Laureate Education |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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