Correlation Between Tex Cycle and Public Bank
Can any of the company-specific risk be diversified away by investing in both Tex Cycle and Public Bank 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 Tex Cycle and Public Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tex Cycle Technology and Public Bank Bhd, you can compare the effects of market volatilities on Tex Cycle and Public Bank 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 Tex Cycle with a short position of Public Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tex Cycle and Public Bank.
Diversification Opportunities for Tex Cycle and Public Bank
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Tex and Public is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Tex Cycle Technology and Public Bank Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Public Bank Bhd and Tex Cycle 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 Tex Cycle Technology are associated (or correlated) with Public Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Public Bank Bhd has no effect on the direction of Tex Cycle i.e., Tex Cycle and Public Bank go up and down completely randomly.
Pair Corralation between Tex Cycle and Public Bank
Assuming the 90 days trading horizon Tex Cycle Technology is expected to generate 2.24 times more return on investment than Public Bank. However, Tex Cycle is 2.24 times more volatile than Public Bank Bhd. It trades about 0.05 of its potential returns per unit of risk. Public Bank Bhd is currently generating about 0.06 per unit of risk. If you would invest 77.00 in Tex Cycle Technology on August 31, 2024 and sell it today you would earn a total of 27.00 from holding Tex Cycle Technology or generate 35.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.73% |
| Values | Daily Returns |
Tex Cycle Technology vs. Public Bank Bhd
Performance |
| Timeline |
| Tex Cycle Technology |
| Public Bank Bhd |
Tex Cycle and Public Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tex Cycle and Public Bank
The main advantage of trading using opposite Tex Cycle and Public Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tex Cycle position performs unexpectedly, Public Bank 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 Public Bank will offset losses from the drop in Public Bank's long position.| Tex Cycle vs. Computer Forms Bhd | Tex Cycle vs. MClean Technologies Bhd | Tex Cycle vs. Digistar Bhd | Tex Cycle vs. Minetech Resources Bhd |
| Public Bank vs. Nova Wellness Group | Public Bank vs. Dataprep Holdings Bhd | Public Bank vs. Impiana Hotels Bhd | Public Bank vs. Daya Materials 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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