Correlation Between PT Bank and ROSENBAUER INTERNAT

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

Diversification Opportunities for PT Bank and ROSENBAUER INTERNAT

-0.47

Correlation Coefficient

PT Bank  ROSENBAUER INTERNAT

Very good diversification

The 3 months correlation between PQ9 and ROSENBAUER is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Mandiri and ROSENBAUER INTERNAT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ROSENBAUER INTERNAT 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 ROSENBAUER INTERNAT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ROSENBAUER INTERNAT has no effect on the direction of PT Bank i.e., PT Bank and ROSENBAUER INTERNAT go up and down completely randomly.

Pair Corralation between PT Bank and ROSENBAUER INTERNAT

Assuming the 90 days horizon PT Bank Mandiri is expected to under-perform the ROSENBAUER INTERNAT. In addition to that, PT Bank is 4.16 times more volatile than ROSENBAUER INTERNAT. It trades about 0.0 of its total potential returns per unit of risk. ROSENBAUER INTERNAT is currently generating about 0.2 per unit of volatility. If you would invest  3,850  in ROSENBAUER INTERNAT on April 25, 2025 and sell it today you would earn a total of  970.00  from holding ROSENBAUER INTERNAT or generate 25.19% 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.  ROSENBAUER INTERNAT

PT Bank Mandiri

Risk-Adjusted Performance

Weak

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

ROSENBAUER INTERNAT

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in ROSENBAUER INTERNAT are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady forward indicators, ROSENBAUER INTERNAT exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PT Bank and ROSENBAUER INTERNAT

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

The idea behind PT Bank Mandiri and ROSENBAUER INTERNAT 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.