Correlation Between K One and Shangri La
Can any of the company-specific risk be diversified away by investing in both K One 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 K One and Shangri La 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 Shangri La Hotels, you can compare the effects of market volatilities on K One 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 K One with a short position of Shangri La. Check out your portfolio center. Please also check ongoing floating volatility patterns of K One and Shangri La.
Diversification Opportunities for K One and Shangri La
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between 0111 and Shangri is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding K One Technology 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 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 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 K One i.e., K One and Shangri La go up and down completely randomly.
Pair Corralation between K One and Shangri La
Assuming the 90 days trading horizon K One Technology Bhd is expected to generate 3.32 times more return on investment than Shangri La. However, K One is 3.32 times more volatile than Shangri La Hotels. It trades about 0.08 of its potential returns per unit of risk. Shangri La Hotels is currently generating about 0.01 per unit of risk. If you would invest 17.00 in K One Technology Bhd on September 12, 2024 and sell it today you would earn a total of 1.00 from holding K One Technology Bhd or generate 5.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
K One Technology Bhd vs. Shangri La Hotels
Performance |
| Timeline |
| K One Technology |
| Shangri La Hotels |
K One and Shangri La Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with K One and Shangri La
The main advantage of trading using opposite K One and Shangri La positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if K One 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.| K One vs. Cloudpoint Technology Berhad | K One vs. Apex Healthcare Bhd | K One vs. Senheng New Retail | K One vs. Awanbiru Technology Bhd |
| Shangri La vs. Berjaya Food Bhd | Shangri La vs. ECM Libra Financial | Shangri La vs. Al Aqar Healthcare | Shangri La vs. PMB Technology 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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