Correlation Between Sunzen Biotech and LPI Capital
Can any of the company-specific risk be diversified away by investing in both Sunzen Biotech and LPI Capital 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 LPI Capital 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 LPI Capital Bhd, you can compare the effects of market volatilities on Sunzen Biotech and LPI Capital 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 LPI Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunzen Biotech and LPI Capital.
Diversification Opportunities for Sunzen Biotech and LPI Capital
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sunzen and LPI is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Sunzen Biotech Bhd and LPI Capital Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LPI Capital 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 LPI Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LPI Capital Bhd has no effect on the direction of Sunzen Biotech i.e., Sunzen Biotech and LPI Capital go up and down completely randomly.
Pair Corralation between Sunzen Biotech and LPI Capital
Assuming the 90 days trading horizon Sunzen Biotech Bhd is expected to under-perform the LPI Capital. In addition to that, Sunzen Biotech is 1.42 times more volatile than LPI Capital Bhd. It trades about -0.1 of its total potential returns per unit of risk. LPI Capital Bhd is currently generating about 0.11 per unit of volatility. If you would invest 1,272 in LPI Capital Bhd on September 3, 2024 and sell it today you would earn a total of 52.00 from holding LPI Capital Bhd or generate 4.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.62% |
| Values | Daily Returns |
Sunzen Biotech Bhd vs. LPI Capital Bhd
Performance |
| Timeline |
| Sunzen Biotech Bhd |
| LPI Capital Bhd |
Sunzen Biotech and LPI Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunzen Biotech and LPI Capital
The main advantage of trading using opposite Sunzen Biotech and LPI Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunzen Biotech position performs unexpectedly, LPI Capital 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 LPI Capital will offset losses from the drop in LPI Capital's long position.| Sunzen Biotech vs. British American Tobacco | Sunzen Biotech vs. FARM FRESH BERHAD | Sunzen Biotech vs. Apollo Food Holdings | Sunzen Biotech vs. Oriental Food Industries |
| LPI Capital vs. SFP Tech Holdings | LPI Capital vs. YX Precious Metals | LPI Capital vs. FARM FRESH BERHAD | LPI Capital vs. ES Ceramics Technology |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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