Correlation Between Eversafe Rubber and Star Media
Can any of the company-specific risk be diversified away by investing in both Eversafe Rubber and Star Media 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 Eversafe Rubber and Star Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eversafe Rubber Bhd and Star Media Group, you can compare the effects of market volatilities on Eversafe Rubber and Star Media 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 Eversafe Rubber with a short position of Star Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eversafe Rubber and Star Media.
Diversification Opportunities for Eversafe Rubber and Star Media
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eversafe and Star is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Eversafe Rubber Bhd and Star Media Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Star Media Group and Eversafe Rubber 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 Eversafe Rubber Bhd are associated (or correlated) with Star Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Star Media Group has no effect on the direction of Eversafe Rubber i.e., Eversafe Rubber and Star Media go up and down completely randomly.
Pair Corralation between Eversafe Rubber and Star Media
Assuming the 90 days trading horizon Eversafe Rubber is expected to generate 3.58 times less return on investment than Star Media. In addition to that, Eversafe Rubber is 1.37 times more volatile than Star Media Group. It trades about 0.01 of its total potential returns per unit of risk. Star Media Group is currently generating about 0.04 per unit of volatility. If you would invest 30.00 in Star Media Group on September 3, 2024 and sell it today you would earn a total of 11.00 from holding Star Media Group or generate 36.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eversafe Rubber Bhd vs. Star Media Group
Performance |
| Timeline |
| Eversafe Rubber Bhd |
| Star Media Group |
Eversafe Rubber and Star Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eversafe Rubber and Star Media
The main advantage of trading using opposite Eversafe Rubber and Star Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eversafe Rubber position performs unexpectedly, Star Media 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 Star Media will offset losses from the drop in Star Media's long position.| Eversafe Rubber vs. Sapura Industrial Bhd | Eversafe Rubber vs. Minetech Resources Bhd | Eversafe Rubber vs. Swift Haulage Bhd | Eversafe Rubber vs. Insas Bhd |
| Star Media vs. Kawan Food Bhd | Star Media vs. Eversafe Rubber Bhd | Star Media vs. Hong Leong Bank | Star Media vs. Malayan Banking 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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