Correlation Between Binasat Communications and Swift Haulage
Can any of the company-specific risk be diversified away by investing in both Binasat Communications and Swift Haulage 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 Swift Haulage 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 Swift Haulage Bhd, you can compare the effects of market volatilities on Binasat Communications and Swift Haulage 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 Swift Haulage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binasat Communications and Swift Haulage.
Diversification Opportunities for Binasat Communications and Swift Haulage
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Binasat and Swift is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Binasat Communications Bhd and Swift Haulage Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swift Haulage 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 Swift Haulage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swift Haulage Bhd has no effect on the direction of Binasat Communications i.e., Binasat Communications and Swift Haulage go up and down completely randomly.
Pair Corralation between Binasat Communications and Swift Haulage
Assuming the 90 days trading horizon Binasat Communications Bhd is expected to generate 1.56 times more return on investment than Swift Haulage. However, Binasat Communications is 1.56 times more volatile than Swift Haulage Bhd. It trades about -0.04 of its potential returns per unit of risk. Swift Haulage Bhd is currently generating about -0.07 per unit of risk. If you would invest 23.00 in Binasat Communications Bhd on September 2, 2024 and sell it today you would lose (2.00) from holding Binasat Communications Bhd or give up 8.7% 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. Swift Haulage Bhd
Performance |
| Timeline |
| Binasat Communications |
| Swift Haulage Bhd |
Binasat Communications and Swift Haulage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Binasat Communications and Swift Haulage
The main advantage of trading using opposite Binasat Communications and Swift Haulage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binasat Communications position performs unexpectedly, Swift Haulage 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 Swift Haulage will offset losses from the drop in Swift Haulage's long position.| Binasat Communications vs. Digistar Bhd | Binasat Communications vs. Minetech Resources Bhd | Binasat Communications vs. Swift Haulage Bhd | Binasat Communications vs. Bina Darulaman Bhd |
| Swift Haulage vs. Malayan Banking Bhd | Swift Haulage vs. Public Bank Bhd | Swift Haulage vs. Petronas Chemicals Group | Swift Haulage vs. Tenaga Nasional 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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