Correlation Between Lyc Healthcare and Farm Price
Can any of the company-specific risk be diversified away by investing in both Lyc Healthcare and Farm Price 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 Lyc Healthcare and Farm Price into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyc Healthcare Bhd and Farm Price Holdings, you can compare the effects of market volatilities on Lyc Healthcare and Farm Price 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 Lyc Healthcare with a short position of Farm Price. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyc Healthcare and Farm Price.
Diversification Opportunities for Lyc Healthcare and Farm Price
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lyc and Farm is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Lyc Healthcare Bhd and Farm Price Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Farm Price Holdings and Lyc Healthcare 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 Lyc Healthcare Bhd are associated (or correlated) with Farm Price. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Farm Price Holdings has no effect on the direction of Lyc Healthcare i.e., Lyc Healthcare and Farm Price go up and down completely randomly.
Pair Corralation between Lyc Healthcare and Farm Price
Assuming the 90 days trading horizon Lyc Healthcare Bhd is expected to generate 2.76 times more return on investment than Farm Price. However, Lyc Healthcare is 2.76 times more volatile than Farm Price Holdings. It trades about 0.08 of its potential returns per unit of risk. Farm Price Holdings is currently generating about -0.57 per unit of risk. If you would invest 9.50 in Lyc Healthcare Bhd on October 24, 2024 and sell it today you would earn a total of 0.50 from holding Lyc Healthcare Bhd or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lyc Healthcare Bhd vs. Farm Price Holdings
Performance |
| Timeline |
| Lyc Healthcare Bhd |
| Farm Price Holdings |
Lyc Healthcare and Farm Price Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyc Healthcare and Farm Price
The main advantage of trading using opposite Lyc Healthcare and Farm Price positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyc Healthcare position performs unexpectedly, Farm Price 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 Farm Price will offset losses from the drop in Farm Price's long position.| Lyc Healthcare vs. IHH Healthcare Bhd | Lyc Healthcare vs. KPJ Healthcare Bhd | Lyc Healthcare vs. Pesona Metro Holdings |
| Farm Price vs. Al Aqar Healthcare | Farm Price vs. Senheng New Retail | Farm Price vs. Kossan Rubber Industries | Farm Price vs. ECM Libra Financial |
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 Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |