Correlation Between Corporate Travel and BANK MANDIRI

Can any of the company-specific risk be diversified away by investing in both Corporate Travel 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 Corporate Travel and BANK MANDIRI into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Corporate Travel Management and BANK MANDIRI, you can compare the effects of market volatilities on Corporate Travel 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 Corporate Travel with a short position of BANK MANDIRI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Corporate Travel and BANK MANDIRI.

Diversification Opportunities for Corporate Travel and BANK MANDIRI

-0.6

Correlation Coefficient

Corporate Travel  BANK MANDIRI

Excellent diversification

The 3 months correlation between Corporate and BANK is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Corporate Travel Management and BANK MANDIRI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANK MANDIRI and Corporate Travel 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 Corporate Travel Management 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 Corporate Travel i.e., Corporate Travel and BANK MANDIRI go up and down completely randomly.

Pair Corralation between Corporate Travel and BANK MANDIRI

Assuming the 90 days trading horizon Corporate Travel Management is expected to under-perform the BANK MANDIRI. In addition to that, Corporate Travel is 1.23 times more volatile than BANK MANDIRI. It trades about -0.01 of its total potential returns per unit of risk. BANK MANDIRI is currently generating about 0.03 per unit of volatility. If you would invest  28.00  in BANK MANDIRI on October 4, 2024 and sell it today you would earn a total of  6.00  from holding BANK MANDIRI or generate 21.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Corporate Travel Management  vs.  BANK MANDIRI

Corporate Travel Man

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Corporate Travel Management are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Corporate Travel is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

BANK MANDIRI

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BANK MANDIRI has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Corporate Travel and BANK MANDIRI

The main advantage of trading using opposite Corporate Travel and BANK MANDIRI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Corporate Travel 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.

The idea behind Corporate Travel Management and BANK MANDIRI pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.