Correlation Between Cengild Medical and FGV Holdings
Can any of the company-specific risk be diversified away by investing in both Cengild Medical and FGV Holdings 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 Cengild Medical and FGV Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cengild Medical Berhad and FGV Holdings Bhd, you can compare the effects of market volatilities on Cengild Medical and FGV Holdings 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 Cengild Medical with a short position of FGV Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cengild Medical and FGV Holdings.
Diversification Opportunities for Cengild Medical and FGV Holdings
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cengild and FGV is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Cengild Medical Berhad and FGV Holdings Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FGV Holdings Bhd and Cengild Medical 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 Cengild Medical Berhad are associated (or correlated) with FGV Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FGV Holdings Bhd has no effect on the direction of Cengild Medical i.e., Cengild Medical and FGV Holdings go up and down completely randomly.
Pair Corralation between Cengild Medical and FGV Holdings
Assuming the 90 days trading horizon Cengild Medical Berhad is expected to generate 1.63 times more return on investment than FGV Holdings. However, Cengild Medical is 1.63 times more volatile than FGV Holdings Bhd. It trades about 0.01 of its potential returns per unit of risk. FGV Holdings Bhd is currently generating about -0.09 per unit of risk. If you would invest 28.00 in Cengild Medical Berhad on November 5, 2024 and sell it today you would earn a total of 0.00 from holding Cengild Medical Berhad or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cengild Medical Berhad vs. FGV Holdings Bhd
Performance |
| Timeline |
| Cengild Medical Berhad |
| FGV Holdings Bhd |
Cengild Medical and FGV Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cengild Medical and FGV Holdings
The main advantage of trading using opposite Cengild Medical and FGV Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cengild Medical position performs unexpectedly, FGV Holdings 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 FGV Holdings will offset losses from the drop in FGV Holdings' long position.| Cengild Medical vs. KPJ Healthcare Bhd | Cengild Medical vs. Homeritz Bhd | Cengild Medical vs. Binasat Communications Bhd | Cengild Medical vs. Senheng New Retail |
| FGV Holdings vs. Dufu Tech Corp | FGV Holdings vs. ONETECH SOLUTIONS HOLDINGS | FGV Holdings vs. Systech Bhd | FGV Holdings vs. ES Ceramics Technology |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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