Correlation Between Bank Mandiri and Landcadia Holdings

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

Diversification Opportunities for Bank Mandiri and Landcadia Holdings

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Correlation Coefficient

Bank Mandiri  Landcadia Holdings

Pay attention - limited upside

The 3 months correlation between Bank and Landcadia is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Landcadia Holdings II in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Landcadia Holdings 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 Landcadia Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Landcadia Holdings has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Landcadia Holdings go up and down completely randomly.

Pair Corralation between Bank Mandiri and Landcadia Holdings

Assuming the 90 days horizon Bank Mandiri Persero is expected to generate 3.45 times more return on investment than Landcadia Holdings. However, Bank Mandiri is 3.45 times more volatile than Landcadia Holdings II. It trades about 0.03 of its potential returns per unit of risk. Landcadia Holdings II is currently generating about 0.03 per unit of risk. If you would invest  1,221  in Bank Mandiri Persero on October 7, 2024 and sell it today you would earn a total of  197.00  from holding Bank Mandiri Persero or generate 16.13% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	26.21%
Values	Daily Returns

Bank Mandiri Persero  vs.  Landcadia Holdings II

Bank Mandiri Persero

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Bank Mandiri Persero 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 fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Landcadia Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Landcadia Holdings II has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical indicators, Landcadia Holdings is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Bank Mandiri and Landcadia Holdings

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

The idea behind Bank Mandiri Persero and Landcadia Holdings II 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.