Correlation Between Sunzen Biotech and MClean Technologies
Can any of the company-specific risk be diversified away by investing in both Sunzen Biotech and MClean Technologies 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 MClean Technologies 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 MClean Technologies Bhd, you can compare the effects of market volatilities on Sunzen Biotech and MClean Technologies 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 MClean Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunzen Biotech and MClean Technologies.
Diversification Opportunities for Sunzen Biotech and MClean Technologies
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Sunzen and MClean is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Sunzen Biotech Bhd and MClean Technologies Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MClean Technologies 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 MClean Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MClean Technologies Bhd has no effect on the direction of Sunzen Biotech i.e., Sunzen Biotech and MClean Technologies go up and down completely randomly.
Pair Corralation between Sunzen Biotech and MClean Technologies
Assuming the 90 days trading horizon Sunzen Biotech is expected to generate 3.39 times less return on investment than MClean Technologies. But when comparing it to its historical volatility, Sunzen Biotech Bhd is 1.85 times less risky than MClean Technologies. It trades about 0.01 of its potential returns per unit of risk. MClean Technologies Bhd is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 29.00 in MClean Technologies Bhd on November 27, 2024 and sell it today you would earn a total of 0.00 from holding MClean Technologies Bhd or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunzen Biotech Bhd vs. MClean Technologies Bhd
Performance |
| Timeline |
| Sunzen Biotech Bhd |
| MClean Technologies Bhd |
Sunzen Biotech and MClean Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunzen Biotech and MClean Technologies
The main advantage of trading using opposite Sunzen Biotech and MClean Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunzen Biotech position performs unexpectedly, MClean Technologies 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 MClean Technologies will offset losses from the drop in MClean Technologies' long position.| Sunzen Biotech vs. Senheng New Retail | Sunzen Biotech vs. Kawan Food Bhd | Sunzen Biotech vs. Choo Bee Metal | Sunzen Biotech vs. Apollo Food Holdings |
| MClean Technologies vs. Malaysia Steel Works | MClean Technologies vs. Choo Bee Metal | MClean Technologies vs. Diversified Gateway Solutions | MClean Technologies vs. Apex Healthcare 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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