Correlation Between FAST RETAIL and BANK MANDIRI

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

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

Diversification Opportunities for FAST RETAIL and BANK MANDIRI

0.0

Correlation Coefficient

FAST RETAIL  BANK MANDIRI

Pay attention - limited upside

The 3 months correlation between FAST and BANK is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FAST RETAIL ADR and BANK MANDIRI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANK MANDIRI and FAST RETAIL 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 FAST RETAIL ADR 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 FAST RETAIL i.e., FAST RETAIL and BANK MANDIRI go up and down completely randomly.

Pair Corralation between FAST RETAIL and BANK MANDIRI

If you would invest  3,000  in FAST RETAIL ADR on October 4, 2024 and sell it today you would earn a total of  220.00  from holding FAST RETAIL ADR or generate 7.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

FAST RETAIL ADR  vs.  BANK MANDIRI

FAST RETAIL ADR

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in FAST RETAIL ADR are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, FAST RETAIL may actually be approaching a critical reversion point that can send shares even higher in February 2025.

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 weak 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 FAST RETAIL and BANK MANDIRI

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

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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.