Correlation Between Bank Mandiri and Resolute Forest
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Resolute Forest 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 Resolute Forest 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 Resolute Forest Products, you can compare the effects of market volatilities on Bank Mandiri and Resolute Forest 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 Resolute Forest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Resolute Forest.
Diversification Opportunities for Bank Mandiri and Resolute Forest
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and Resolute is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Resolute Forest Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Resolute Forest Products 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 Resolute Forest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Resolute Forest Products has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Resolute Forest go up and down completely randomly.
Pair Corralation between Bank Mandiri and Resolute Forest
If you would invest 2,192 in Resolute Forest Products on September 24, 2024 and sell it today you would earn a total of 0.00 from holding Resolute Forest Products or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 1.56% |
Values | Daily Returns |
Bank Mandiri Persero vs. Resolute Forest Products
Performance |
Timeline |
Bank Mandiri Persero |
Resolute Forest Products |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Bank Mandiri and Resolute Forest Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bank Mandiri and Resolute Forest
The main advantage of trading using opposite Bank Mandiri and Resolute Forest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Resolute Forest 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 Resolute Forest will offset losses from the drop in Resolute Forest's long position.Bank Mandiri vs. Banco Bradesco SA | Bank Mandiri vs. Itau Unibanco Banco | Bank Mandiri vs. Lloyds Banking Group | Bank Mandiri vs. Deutsche Bank AG |
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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