Correlation Between PT Bank and LINMON MEDIA

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

By analyzing existing cross correlation between PT Bank Mandiri and LINMON MEDIA LTD, you can compare the effects of market volatilities on PT Bank and LINMON MEDIA 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 PT Bank with a short position of LINMON MEDIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and LINMON MEDIA.

Diversification Opportunities for PT Bank and LINMON MEDIA

-0.52

Correlation Coefficient

PT Bank  LINMON MEDIA

Excellent diversification

The 3 months correlation between PQ9 and LINMON is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Mandiri and LINMON MEDIA LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LINMON MEDIA LTD and PT Bank 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 PT Bank Mandiri are associated (or correlated) with LINMON MEDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LINMON MEDIA LTD has no effect on the direction of PT Bank i.e., PT Bank and LINMON MEDIA go up and down completely randomly.

Pair Corralation between PT Bank and LINMON MEDIA

Assuming the 90 days horizon PT Bank is expected to generate 6.21 times less return on investment than LINMON MEDIA. In addition to that, PT Bank is 1.39 times more volatile than LINMON MEDIA LTD. It trades about 0.01 of its total potential returns per unit of risk. LINMON MEDIA LTD is currently generating about 0.11 per unit of volatility. If you would invest  28.00  in LINMON MEDIA LTD on April 22, 2025 and sell it today you would earn a total of  10.00  from holding LINMON MEDIA LTD or generate 35.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

PT Bank Mandiri  vs.  LINMON MEDIA LTD

PT Bank Mandiri

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in PT Bank Mandiri are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, PT Bank is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

LINMON MEDIA LTD

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in LINMON MEDIA LTD are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, LINMON MEDIA reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PT Bank and LINMON MEDIA

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

The idea behind PT Bank Mandiri and LINMON MEDIA LTD 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 Commodity Directory module to find actively traded commodities issued by global exchanges.