Correlation Between Bank Mandiri and ABIVAX Société

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

Diversification Opportunities for Bank Mandiri and ABIVAX Société

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  Correlation Coefficient

Pay attention - limited upside

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

Pair Corralation between Bank Mandiri and ABIVAX Société

Assuming the 90 days horizon Bank Mandiri Persero is expected to generate 2.55 times more return on investment than ABIVAX Société. However, Bank Mandiri is 2.55 times more volatile than ABIVAX Socit Anonyme. It trades about 0.06 of its potential returns per unit of risk. ABIVAX Socit Anonyme is currently generating about 0.03 per unit of risk. If you would invest  29.00  in Bank Mandiri Persero on August 14, 2024 and sell it today you would earn a total of  15.00  from holding Bank Mandiri Persero or generate 51.72% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy90.69%
ValuesDaily Returns

Bank Mandiri Persero  vs.  ABIVAX Socit Anonyme

 Performance 
       Timeline  
Bank Mandiri Persero 

Risk-Adjusted Performance

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Over the last 90 days Bank Mandiri Persero has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Bank Mandiri is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.
ABIVAX Socit Anonyme 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days ABIVAX Socit Anonyme has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, ABIVAX Société is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Bank Mandiri and ABIVAX Société Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Bank Mandiri and ABIVAX Société

The main advantage of trading using opposite Bank Mandiri and ABIVAX Société positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, ABIVAX Société 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 ABIVAX Société will offset losses from the drop in ABIVAX Société's long position.
The idea behind Bank Mandiri Persero and ABIVAX Socit Anonyme 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .

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