Correlation Between Binasat Communications and JAKS Resources
Can any of the company-specific risk be diversified away by investing in both Binasat Communications and JAKS Resources 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 Binasat Communications and JAKS Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Binasat Communications Bhd and JAKS Resources Bhd, you can compare the effects of market volatilities on Binasat Communications and JAKS Resources 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 Binasat Communications with a short position of JAKS Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binasat Communications and JAKS Resources.
Diversification Opportunities for Binasat Communications and JAKS Resources
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Binasat and JAKS is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Binasat Communications Bhd and JAKS Resources Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JAKS Resources Bhd and Binasat Communications 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 Binasat Communications Bhd are associated (or correlated) with JAKS Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JAKS Resources Bhd has no effect on the direction of Binasat Communications i.e., Binasat Communications and JAKS Resources go up and down completely randomly.
Pair Corralation between Binasat Communications and JAKS Resources
Assuming the 90 days trading horizon Binasat Communications Bhd is expected to under-perform the JAKS Resources. But the stock apears to be less risky and, when comparing its historical volatility, Binasat Communications Bhd is 1.64 times less risky than JAKS Resources. The stock trades about -0.04 of its potential returns per unit of risk. The JAKS Resources Bhd is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 18.00 in JAKS Resources Bhd on November 5, 2024 and sell it today you would lose (5.00) from holding JAKS Resources Bhd or give up 27.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Binasat Communications Bhd vs. JAKS Resources Bhd
Performance |
| Timeline |
| Binasat Communications |
| JAKS Resources Bhd |
Binasat Communications and JAKS Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Binasat Communications and JAKS Resources
The main advantage of trading using opposite Binasat Communications and JAKS Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binasat Communications position performs unexpectedly, JAKS Resources 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 JAKS Resources will offset losses from the drop in JAKS Resources' long position.| Binasat Communications vs. Telekom Malaysia Bhd | Binasat Communications vs. TIME Dotcom Bhd | Binasat Communications vs. Apollo Food Holdings | Binasat Communications vs. Genetec Technology Bhd |
| JAKS Resources vs. Icon Offshore Bhd | JAKS Resources vs. Senheng New Retail | JAKS Resources vs. Choo Bee Metal | JAKS Resources vs. Uchi Technologies 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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