Correlation Between Bank Mandiri and Bluesky Digital

Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Bluesky Digital 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 Bluesky Digital into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Bank Mandiri Persero and Bluesky Digital Assets, you can compare the effects of market volatilities on Bank Mandiri and Bluesky Digital 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 Bluesky Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Bluesky Digital.

Diversification Opportunities for Bank Mandiri and Bluesky Digital

0.58

Correlation Coefficient

Bank Mandiri  Bluesky Digital

Very weak diversification

The 3 months correlation between Bank and Bluesky is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Bluesky Digital Assets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bluesky Digital Assets 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 Persero are associated (or correlated) with Bluesky Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bluesky Digital Assets has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Bluesky Digital go up and down completely randomly.

Pair Corralation between Bank Mandiri and Bluesky Digital

Assuming the 90 days horizon Bank Mandiri is expected to generate 13.06 times less return on investment than Bluesky Digital. But when comparing it to its historical volatility, Bank Mandiri Persero is 3.66 times less risky than Bluesky Digital. It trades about 0.02 of its potential returns per unit of risk. Bluesky Digital Assets is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  12.00  in Bluesky Digital Assets on December 1, 2024 and sell it today you would earn a total of  2.00  from holding Bluesky Digital Assets or generate 16.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	76.52%
Values	Daily Returns

Bank Mandiri Persero  vs.  Bluesky Digital Assets

Bank Mandiri Persero

Risk-Adjusted Performance

Very Weak

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

Bluesky Digital Assets

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Bank Mandiri and Bluesky Digital

The main advantage of trading using opposite Bank Mandiri and Bluesky Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Bluesky Digital 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 Bluesky Digital will offset losses from the drop in Bluesky Digital's long position.

The idea behind Bank Mandiri Persero and Bluesky Digital Assets 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.