Correlation Between ES Ceramics and Sunway Construction
Can any of the company-specific risk be diversified away by investing in both ES Ceramics and Sunway Construction 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 Sunway Construction 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 Sunway Construction Group, you can compare the effects of market volatilities on ES Ceramics and Sunway Construction 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 Sunway Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of ES Ceramics and Sunway Construction.
Diversification Opportunities for ES Ceramics and Sunway Construction
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 0100 and Sunway is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding ES Ceramics Technology and Sunway Construction Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunway Construction 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 Sunway Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunway Construction has no effect on the direction of ES Ceramics i.e., ES Ceramics and Sunway Construction go up and down completely randomly.
Pair Corralation between ES Ceramics and Sunway Construction
Assuming the 90 days trading horizon ES Ceramics Technology is expected to under-perform the Sunway Construction. In addition to that, ES Ceramics is 1.0 times more volatile than Sunway Construction Group. It trades about -0.12 of its total potential returns per unit of risk. Sunway Construction Group is currently generating about 0.0 per unit of volatility. If you would invest 454.00 in Sunway Construction Group on August 28, 2024 and sell it today you would lose (4.00) from holding Sunway Construction Group or give up 0.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ES Ceramics Technology vs. Sunway Construction Group
Performance |
| Timeline |
| ES Ceramics Technology |
| Sunway Construction |
ES Ceramics and Sunway Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ES Ceramics and Sunway Construction
The main advantage of trading using opposite ES Ceramics and Sunway Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ES Ceramics position performs unexpectedly, Sunway Construction 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 Sunway Construction will offset losses from the drop in Sunway Construction's long position.| ES Ceramics vs. Digistar Bhd | ES Ceramics vs. Minetech Resources Bhd | ES Ceramics vs. OpenSys M Bhd | ES Ceramics vs. Insas Bhd |
| Sunway Construction vs. Cloudpoint Technology Berhad | Sunway Construction vs. ES Ceramics Technology | Sunway Construction vs. Privasia Technology Bhd | Sunway Construction vs. Computer Forms 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |