Correlation Between Lyc Healthcare and CB Industrial
Can any of the company-specific risk be diversified away by investing in both Lyc Healthcare and CB Industrial 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 CB Industrial 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 CB Industrial Product, you can compare the effects of market volatilities on Lyc Healthcare and CB Industrial 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 CB Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyc Healthcare and CB Industrial.
Diversification Opportunities for Lyc Healthcare and CB Industrial
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lyc and 7076 is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Lyc Healthcare Bhd and CB Industrial Product in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CB Industrial Product 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 CB Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CB Industrial Product has no effect on the direction of Lyc Healthcare i.e., Lyc Healthcare and CB Industrial go up and down completely randomly.
Pair Corralation between Lyc Healthcare and CB Industrial
Assuming the 90 days trading horizon Lyc Healthcare Bhd is expected to generate 1.5 times more return on investment than CB Industrial. However, Lyc Healthcare is 1.5 times more volatile than CB Industrial Product. It trades about -0.18 of its potential returns per unit of risk. CB Industrial Product is currently generating about -0.35 per unit of risk. If you would invest 10.00 in Lyc Healthcare Bhd on November 4, 2024 and sell it today you would lose (1.00) from holding Lyc Healthcare Bhd or give up 10.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Lyc Healthcare Bhd vs. CB Industrial Product
Performance |
| Timeline |
| Lyc Healthcare Bhd |
| CB Industrial Product |
Lyc Healthcare and CB Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyc Healthcare and CB Industrial
The main advantage of trading using opposite Lyc Healthcare and CB Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyc Healthcare position performs unexpectedly, CB Industrial 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 CB Industrial will offset losses from the drop in CB Industrial's long position.| Lyc Healthcare vs. Press Metal Bhd | Lyc Healthcare vs. Eonmetall Group Bhd | Lyc Healthcare vs. Cengild Medical Berhad | Lyc Healthcare vs. Farm Price Holdings |
| CB Industrial vs. ECM Libra Financial | CB Industrial vs. Farm Price Holdings | CB Industrial vs. Sports Toto Berhad | CB Industrial vs. Al Aqar Healthcare |
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 CEOs Directory module to screen CEOs from public companies around the world.
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