Correlation Between Greatech Technology and MISC Bhd
Can any of the company-specific risk be diversified away by investing in both Greatech Technology and MISC Bhd 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 Greatech Technology and MISC Bhd into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Greatech Technology Bhd and MISC Bhd, you can compare the effects of market volatilities on Greatech Technology and MISC Bhd 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 Greatech Technology with a short position of MISC Bhd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greatech Technology and MISC Bhd.
Diversification Opportunities for Greatech Technology and MISC Bhd
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Greatech and MISC is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Greatech Technology Bhd and MISC Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MISC Bhd and Greatech Technology 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 Greatech Technology Bhd are associated (or correlated) with MISC Bhd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MISC Bhd has no effect on the direction of Greatech Technology i.e., Greatech Technology and MISC Bhd go up and down completely randomly.
Pair Corralation between Greatech Technology and MISC Bhd
Assuming the 90 days trading horizon Greatech Technology Bhd is expected to under-perform the MISC Bhd. In addition to that, Greatech Technology is 2.35 times more volatile than MISC Bhd. It trades about -0.01 of its total potential returns per unit of risk. MISC Bhd is currently generating about 0.03 per unit of volatility. If you would invest 751.00 in MISC Bhd on August 28, 2024 and sell it today you would earn a total of 5.00 from holding MISC Bhd or generate 0.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Greatech Technology Bhd vs. MISC Bhd
Performance |
| Timeline |
| Greatech Technology Bhd |
| MISC Bhd |
Greatech Technology and MISC Bhd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Greatech Technology and MISC Bhd
The main advantage of trading using opposite Greatech Technology and MISC Bhd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greatech Technology position performs unexpectedly, MISC Bhd 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 MISC Bhd will offset losses from the drop in MISC Bhd's long position.| Greatech Technology vs. K One Technology Bhd | Greatech Technology vs. Petronas Chemicals Group | Greatech Technology vs. Coraza Integrated Technology | Greatech Technology vs. ES Ceramics Technology |
| MISC Bhd vs. Lysaght Galvanized Steel | MISC Bhd vs. HeiTech Padu Bhd | MISC Bhd vs. Digistar Bhd | MISC Bhd vs. Swift Haulage 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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