Correlation Between Lyc Healthcare and Al Aqar
Can any of the company-specific risk be diversified away by investing in both Lyc Healthcare and Al Aqar 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 Al Aqar 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 Al Aqar Healthcare, you can compare the effects of market volatilities on Lyc Healthcare and Al Aqar 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 Al Aqar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyc Healthcare and Al Aqar.
Diversification Opportunities for Lyc Healthcare and Al Aqar
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lyc and 5116 is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Lyc Healthcare Bhd and Al Aqar Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Al Aqar Healthcare 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 Al Aqar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Al Aqar Healthcare has no effect on the direction of Lyc Healthcare i.e., Lyc Healthcare and Al Aqar go up and down completely randomly.
Pair Corralation between Lyc Healthcare and Al Aqar
Assuming the 90 days trading horizon Lyc Healthcare Bhd is expected to under-perform the Al Aqar. In addition to that, Lyc Healthcare is 4.17 times more volatile than Al Aqar Healthcare. It trades about -0.04 of its total potential returns per unit of risk. Al Aqar Healthcare is currently generating about 0.04 per unit of volatility. If you would invest 121.00 in Al Aqar Healthcare on August 31, 2024 and sell it today you would earn a total of 17.00 from holding Al Aqar Healthcare or generate 14.05% 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. Al Aqar Healthcare
Performance |
| Timeline |
| Lyc Healthcare Bhd |
| Al Aqar Healthcare |
Lyc Healthcare and Al Aqar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyc Healthcare and Al Aqar
The main advantage of trading using opposite Lyc Healthcare and Al Aqar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyc Healthcare position performs unexpectedly, Al Aqar 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 Al Aqar will offset losses from the drop in Al Aqar's long position.| Lyc Healthcare vs. IHH Healthcare Bhd | Lyc Healthcare vs. KPJ Healthcare Bhd | Lyc Healthcare vs. Digistar Bhd | Lyc Healthcare vs. Minetech Resources Bhd |
| Al Aqar vs. YTL Hospitality REIT | Al Aqar vs. Digistar Bhd | Al Aqar vs. Minetech Resources Bhd | Al Aqar vs. Swift Haulage 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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