Correlation Between ES Ceramics and Awanbiru Technology
Can any of the company-specific risk be diversified away by investing in both ES Ceramics and Awanbiru Technology 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 ES Ceramics and Awanbiru Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ES Ceramics Technology and Awanbiru Technology Bhd, you can compare the effects of market volatilities on ES Ceramics and Awanbiru Technology 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 ES Ceramics with a short position of Awanbiru Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of ES Ceramics and Awanbiru Technology.
Diversification Opportunities for ES Ceramics and Awanbiru Technology
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between 0100 and Awanbiru is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding ES Ceramics Technology and Awanbiru Technology Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Awanbiru Technology Bhd and ES Ceramics 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 ES Ceramics Technology are associated (or correlated) with Awanbiru Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Awanbiru Technology Bhd has no effect on the direction of ES Ceramics i.e., ES Ceramics and Awanbiru Technology go up and down completely randomly.
Pair Corralation between ES Ceramics and Awanbiru Technology
Assuming the 90 days trading horizon ES Ceramics Technology is expected to under-perform the Awanbiru Technology. But the stock apears to be less risky and, when comparing its historical volatility, ES Ceramics Technology is 1.16 times less risky than Awanbiru Technology. The stock trades about -0.06 of its potential returns per unit of risk. The Awanbiru Technology Bhd is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 33.00 in Awanbiru Technology Bhd on October 20, 2024 and sell it today you would earn a total of 2.00 from holding Awanbiru Technology Bhd or generate 6.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ES Ceramics Technology vs. Awanbiru Technology Bhd
Performance |
| Timeline |
| ES Ceramics Technology |
| Awanbiru Technology Bhd |
ES Ceramics and Awanbiru Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ES Ceramics and Awanbiru Technology
The main advantage of trading using opposite ES Ceramics and Awanbiru Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ES Ceramics position performs unexpectedly, Awanbiru Technology 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 Awanbiru Technology will offset losses from the drop in Awanbiru Technology's long position.| ES Ceramics vs. Greatech Technology Bhd | ES Ceramics vs. Petronas Chemicals Group | ES Ceramics vs. YX Precious Metals | ES Ceramics vs. Binasat Communications Bhd |
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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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