Correlation Between K One and Malayan Banking
Can any of the company-specific risk be diversified away by investing in both K One and Malayan Banking 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 K One and Malayan Banking into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between K One Technology Bhd and Malayan Banking Bhd, you can compare the effects of market volatilities on K One and Malayan Banking 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 K One with a short position of Malayan Banking. Check out your portfolio center. Please also check ongoing floating volatility patterns of K One and Malayan Banking.
Diversification Opportunities for K One and Malayan Banking
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between 0111 and Malayan is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding K One Technology Bhd and Malayan Banking Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Malayan Banking Bhd and K One 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 K One Technology Bhd are associated (or correlated) with Malayan Banking. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Malayan Banking Bhd has no effect on the direction of K One i.e., K One and Malayan Banking go up and down completely randomly.
Pair Corralation between K One and Malayan Banking
Assuming the 90 days trading horizon K One Technology Bhd is expected to generate 8.68 times more return on investment than Malayan Banking. However, K One is 8.68 times more volatile than Malayan Banking Bhd. It trades about 0.04 of its potential returns per unit of risk. Malayan Banking Bhd is currently generating about 0.12 per unit of risk. If you would invest 14.00 in K One Technology Bhd on September 2, 2024 and sell it today you would earn a total of 3.00 from holding K One Technology Bhd or generate 21.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
K One Technology Bhd vs. Malayan Banking Bhd
Performance |
| Timeline |
| K One Technology |
| Malayan Banking Bhd |
K One and Malayan Banking Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with K One and Malayan Banking
The main advantage of trading using opposite K One and Malayan Banking positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if K One position performs unexpectedly, Malayan Banking 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 Malayan Banking will offset losses from the drop in Malayan Banking's long position.| K One vs. Hong Leong Bank | K One vs. Sports Toto Berhad | K One vs. Sungei Bagan Rubber | K One vs. Lyc Healthcare Bhd |
| Malayan Banking vs. Public Bank Bhd | Malayan Banking vs. Hong Leong Bank | Malayan Banking vs. RHB Bank 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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