Correlation Between Binasat Communications and AirAsia X
Can any of the company-specific risk be diversified away by investing in both Binasat Communications and AirAsia X 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 AirAsia X 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 AirAsia X Bhd, you can compare the effects of market volatilities on Binasat Communications and AirAsia X 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 AirAsia X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binasat Communications and AirAsia X.
Diversification Opportunities for Binasat Communications and AirAsia X
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Binasat and AirAsia is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Binasat Communications Bhd and AirAsia X Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AirAsia X 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 AirAsia X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AirAsia X Bhd has no effect on the direction of Binasat Communications i.e., Binasat Communications and AirAsia X go up and down completely randomly.
Pair Corralation between Binasat Communications and AirAsia X
Assuming the 90 days trading horizon Binasat Communications Bhd is expected to under-perform the AirAsia X. In addition to that, Binasat Communications is 1.01 times more volatile than AirAsia X Bhd. It trades about -0.05 of its total potential returns per unit of risk. AirAsia X Bhd is currently generating about 0.0 per unit of volatility. If you would invest 207.00 in AirAsia X Bhd on September 15, 2024 and sell it today you would lose (18.00) from holding AirAsia X Bhd or give up 8.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Binasat Communications Bhd vs. AirAsia X Bhd
Performance |
| Timeline |
| Binasat Communications |
| AirAsia X Bhd |
Binasat Communications and AirAsia X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Binasat Communications and AirAsia X
The main advantage of trading using opposite Binasat Communications and AirAsia X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binasat Communications position performs unexpectedly, AirAsia X 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 AirAsia X will offset losses from the drop in AirAsia X's long position.| Binasat Communications vs. Globetronics Tech Bhd | Binasat Communications vs. Duopharma Biotech Bhd | Binasat Communications vs. Kobay Tech Bhd | Binasat Communications vs. YX Precious Metals |
| AirAsia X vs. Public Packages Holdings | AirAsia X vs. Binasat Communications Bhd | AirAsia X vs. Awanbiru Technology Bhd | AirAsia X vs. Sports Toto Berhad |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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