Correlation Between Supercomnet Technologies and Datasonic Group
Can any of the company-specific risk be diversified away by investing in both Supercomnet Technologies and Datasonic Group 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 Supercomnet Technologies and Datasonic Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Supercomnet Technologies Bhd and Datasonic Group Bhd, you can compare the effects of market volatilities on Supercomnet Technologies and Datasonic Group 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 Supercomnet Technologies with a short position of Datasonic Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Supercomnet Technologies and Datasonic Group.
Diversification Opportunities for Supercomnet Technologies and Datasonic Group
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Supercomnet and Datasonic is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Supercomnet Technologies Bhd and Datasonic Group Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Datasonic Group Bhd and Supercomnet Technologies 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 Supercomnet Technologies Bhd are associated (or correlated) with Datasonic Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Datasonic Group Bhd has no effect on the direction of Supercomnet Technologies i.e., Supercomnet Technologies and Datasonic Group go up and down completely randomly.
Pair Corralation between Supercomnet Technologies and Datasonic Group
Assuming the 90 days trading horizon Supercomnet Technologies Bhd is expected to generate 0.83 times more return on investment than Datasonic Group. However, Supercomnet Technologies Bhd is 1.2 times less risky than Datasonic Group. It trades about 0.02 of its potential returns per unit of risk. Datasonic Group Bhd is currently generating about -0.02 per unit of risk. If you would invest 131.00 in Supercomnet Technologies Bhd on September 12, 2024 and sell it today you would earn a total of 1.00 from holding Supercomnet Technologies Bhd or generate 0.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Supercomnet Technologies Bhd vs. Datasonic Group Bhd
Performance |
| Timeline |
| Supercomnet Technologies |
| Datasonic Group Bhd |
Supercomnet Technologies and Datasonic Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Supercomnet Technologies and Datasonic Group
The main advantage of trading using opposite Supercomnet Technologies and Datasonic Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Supercomnet Technologies position performs unexpectedly, Datasonic Group 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 Datasonic Group will offset losses from the drop in Datasonic Group's long position.| Supercomnet Technologies vs. K One Technology Bhd | Supercomnet Technologies vs. YX Precious Metals | Supercomnet Technologies vs. Riverview Rubber Estates | Supercomnet Technologies vs. Kluang Rubber |
| Datasonic Group vs. Resintech Bhd | Datasonic Group vs. Aeon Credit Service | Datasonic Group vs. Globetronics Tech Bhd | Datasonic Group vs. Malayan Banking Bhd |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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