Correlation Between Sanichi Technology and Cengild Medical
Can any of the company-specific risk be diversified away by investing in both Sanichi Technology and Cengild Medical 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 Sanichi Technology and Cengild Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sanichi Technology Bhd and Cengild Medical Berhad, you can compare the effects of market volatilities on Sanichi Technology and Cengild Medical 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 Sanichi Technology with a short position of Cengild Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sanichi Technology and Cengild Medical.
Diversification Opportunities for Sanichi Technology and Cengild Medical
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sanichi and Cengild is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Sanichi Technology Bhd and Cengild Medical Berhad in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cengild Medical Berhad and Sanichi Technology 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 Sanichi Technology Bhd are associated (or correlated) with Cengild Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cengild Medical Berhad has no effect on the direction of Sanichi Technology i.e., Sanichi Technology and Cengild Medical go up and down completely randomly.
Pair Corralation between Sanichi Technology and Cengild Medical
Assuming the 90 days trading horizon Sanichi Technology Bhd is expected to under-perform the Cengild Medical. In addition to that, Sanichi Technology is 2.42 times more volatile than Cengild Medical Berhad. It trades about -0.06 of its total potential returns per unit of risk. Cengild Medical Berhad is currently generating about -0.09 per unit of volatility. If you would invest 28.00 in Cengild Medical Berhad on October 17, 2024 and sell it today you would lose (1.00) from holding Cengild Medical Berhad or give up 3.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sanichi Technology Bhd vs. Cengild Medical Berhad
Performance |
| Timeline |
| Sanichi Technology Bhd |
| Cengild Medical Berhad |
Sanichi Technology and Cengild Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sanichi Technology and Cengild Medical
The main advantage of trading using opposite Sanichi Technology and Cengild Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sanichi Technology position performs unexpectedly, Cengild Medical 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 Cengild Medical will offset losses from the drop in Cengild Medical's long position.| Sanichi Technology vs. Cengild Medical Berhad | Sanichi Technology vs. Southern Steel Bhd | Sanichi Technology vs. Press Metal Bhd | Sanichi Technology vs. RHB Bank Bhd |
| Cengild Medical vs. Tex Cycle Technology | Cengild Medical vs. ECM Libra Financial | Cengild Medical vs. PMB Technology Bhd | Cengild Medical vs. Al Aqar Healthcare |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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