Correlation Between Sunzen Biotech and Daya Materials
Can any of the company-specific risk be diversified away by investing in both Sunzen Biotech and Daya Materials 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 Sunzen Biotech and Daya Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sunzen Biotech Bhd and Daya Materials Bhd, you can compare the effects of market volatilities on Sunzen Biotech and Daya Materials 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 Sunzen Biotech with a short position of Daya Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunzen Biotech and Daya Materials.
Diversification Opportunities for Sunzen Biotech and Daya Materials
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sunzen and Daya is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Sunzen Biotech Bhd and Daya Materials Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daya Materials Bhd and Sunzen Biotech 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 Sunzen Biotech Bhd are associated (or correlated) with Daya Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daya Materials Bhd has no effect on the direction of Sunzen Biotech i.e., Sunzen Biotech and Daya Materials go up and down completely randomly.
Pair Corralation between Sunzen Biotech and Daya Materials
Assuming the 90 days trading horizon Sunzen Biotech Bhd is expected to generate 0.29 times more return on investment than Daya Materials. However, Sunzen Biotech Bhd is 3.5 times less risky than Daya Materials. It trades about -0.09 of its potential returns per unit of risk. Daya Materials Bhd is currently generating about -0.13 per unit of risk. If you would invest 31.00 in Sunzen Biotech Bhd on November 28, 2024 and sell it today you would lose (1.00) from holding Sunzen Biotech Bhd or give up 3.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunzen Biotech Bhd vs. Daya Materials Bhd
Performance |
| Timeline |
| Sunzen Biotech Bhd |
| Daya Materials Bhd |
Sunzen Biotech and Daya Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunzen Biotech and Daya Materials
The main advantage of trading using opposite Sunzen Biotech and Daya Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunzen Biotech position performs unexpectedly, Daya Materials 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 Daya Materials will offset losses from the drop in Daya Materials' long position.| Sunzen Biotech vs. YX Precious Metals | Sunzen Biotech vs. Binasat Communications Bhd | Sunzen Biotech vs. CPE Technology Berhad | Sunzen Biotech vs. Senheng New Retail |
| Daya Materials vs. Sungei Bagan Rubber | Daya Materials vs. Genetec Technology Bhd | Daya Materials vs. SSF Home Group | Daya Materials vs. Aeon Credit Service |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |