Correlation Between Bank Mandiri and JRSIS Health

Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and JRSIS Health 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 JRSIS Health 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 JRSIS Health Care, you can compare the effects of market volatilities on Bank Mandiri and JRSIS Health 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 JRSIS Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and JRSIS Health.

Diversification Opportunities for Bank Mandiri and JRSIS Health

0.72

Correlation Coefficient

Bank Mandiri  JRSIS Health

Poor diversification

The 3 months correlation between Bank and JRSIS is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and JRSIS Health Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JRSIS Health Care 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 JRSIS Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JRSIS Health Care has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and JRSIS Health go up and down completely randomly.

Pair Corralation between Bank Mandiri and JRSIS Health

Assuming the 90 days horizon Bank Mandiri Persero is expected to under-perform the JRSIS Health. But the pink sheet apears to be less risky and, when comparing its historical volatility, Bank Mandiri Persero is 4.02 times less risky than JRSIS Health. The pink sheet trades about -0.08 of its potential returns per unit of risk. The JRSIS Health Care is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest  40.00  in JRSIS Health Care on September 30, 2024 and sell it today you would lose (25.00) from holding JRSIS Health Care or give up 62.5% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	96.97%
Values	Daily Returns

Bank Mandiri Persero  vs.  JRSIS Health Care

Bank Mandiri Persero

Risk-Adjusted Performance

0 of 100

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 unsteady 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.

JRSIS Health Care

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JRSIS Health Care has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Bank Mandiri and JRSIS Health

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

The idea behind Bank Mandiri Persero and JRSIS Health Care 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.