Correlation Between CI GAMES and BANK MANDIRI

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

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

Diversification Opportunities for CI GAMES and BANK MANDIRI

0.62

Correlation Coefficient

CI GAMES  BANK MANDIRI

Poor diversification

The 3 months correlation between CI7 and BANK is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding CI GAMES SA and BANK MANDIRI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANK MANDIRI and CI GAMES 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 CI GAMES SA 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 CI GAMES i.e., CI GAMES and BANK MANDIRI go up and down completely randomly.

Pair Corralation between CI GAMES and BANK MANDIRI

Assuming the 90 days horizon CI GAMES SA is expected to under-perform the BANK MANDIRI. In addition to that, CI GAMES is 1.74 times more volatile than BANK MANDIRI. It trades about -0.22 of its total potential returns per unit of risk. BANK MANDIRI is currently generating about -0.17 per unit of volatility. If you would invest  36.00  in BANK MANDIRI on September 16, 2024 and sell it today you would lose (3.00) from holding BANK MANDIRI or give up 8.33% of portfolio value over 90 days.

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

CI GAMES SA  vs.  BANK MANDIRI

CI GAMES SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CI GAMES SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

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 rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with CI GAMES and BANK MANDIRI

The main advantage of trading using opposite CI GAMES and BANK MANDIRI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI GAMES 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 CI GAMES SA 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.