Correlation Between Daya Materials and Shangri La
Can any of the company-specific risk be diversified away by investing in both Daya Materials and Shangri La 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 Daya Materials and Shangri La into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daya Materials Bhd and Shangri La Hotels, you can compare the effects of market volatilities on Daya Materials and Shangri La 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 Daya Materials with a short position of Shangri La. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daya Materials and Shangri La.
Diversification Opportunities for Daya Materials and Shangri La
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Daya and Shangri is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Daya Materials Bhd and Shangri La Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shangri La Hotels and Daya Materials 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 Daya Materials Bhd are associated (or correlated) with Shangri La. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shangri La Hotels has no effect on the direction of Daya Materials i.e., Daya Materials and Shangri La go up and down completely randomly.
Pair Corralation between Daya Materials and Shangri La
Assuming the 90 days trading horizon Daya Materials Bhd is expected to under-perform the Shangri La. In addition to that, Daya Materials is 1.87 times more volatile than Shangri La Hotels. It trades about -0.02 of its total potential returns per unit of risk. Shangri La Hotels is currently generating about -0.02 per unit of volatility. If you would invest 246.00 in Shangri La Hotels on September 2, 2024 and sell it today you would lose (39.00) from holding Shangri La Hotels or give up 15.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Daya Materials Bhd vs. Shangri La Hotels
Performance |
| Timeline |
| Daya Materials Bhd |
| Shangri La Hotels |
Daya Materials and Shangri La Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daya Materials and Shangri La
The main advantage of trading using opposite Daya Materials and Shangri La positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daya Materials position performs unexpectedly, Shangri La 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 Shangri La will offset losses from the drop in Shangri La's long position.| Daya Materials vs. Barakah Offshore Petroleum | Daya Materials vs. Digistar Bhd | Daya Materials vs. Minetech Resources Bhd | Daya Materials vs. Swift Haulage Bhd |
| Shangri La vs. Digistar Bhd | Shangri La vs. Minetech Resources Bhd | Shangri La vs. Swift Haulage Bhd | Shangri La vs. Bina Darulaman 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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