Correlation Between Cengild Medical and Choo Bee
Can any of the company-specific risk be diversified away by investing in both Cengild Medical and Choo Bee 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 Choo Bee 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 Choo Bee Metal, you can compare the effects of market volatilities on Cengild Medical and Choo Bee 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 Choo Bee. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cengild Medical and Choo Bee.
Diversification Opportunities for Cengild Medical and Choo Bee
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cengild and Choo is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Cengild Medical Berhad and Choo Bee Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Choo Bee Metal 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 Choo Bee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Choo Bee Metal has no effect on the direction of Cengild Medical i.e., Cengild Medical and Choo Bee go up and down completely randomly.
Pair Corralation between Cengild Medical and Choo Bee
Assuming the 90 days trading horizon Cengild Medical Berhad is expected to generate 1.44 times more return on investment than Choo Bee. However, Cengild Medical is 1.44 times more volatile than Choo Bee Metal. It trades about 0.01 of its potential returns per unit of risk. Choo Bee Metal is currently generating about -0.11 per unit of risk. If you would invest 27.00 in Cengild Medical Berhad on October 26, 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 | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cengild Medical Berhad vs. Choo Bee Metal
Performance |
| Timeline |
| Cengild Medical Berhad |
| Choo Bee Metal |
Cengild Medical and Choo Bee Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cengild Medical and Choo Bee
The main advantage of trading using opposite Cengild Medical and Choo Bee positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cengild Medical position performs unexpectedly, Choo Bee 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 Choo Bee will offset losses from the drop in Choo Bee's long position.| Cengild Medical vs. PIE Industrial Bhd | Cengild Medical vs. Binasat Communications Bhd | Cengild Medical vs. Berjaya Food Bhd | Cengild Medical vs. BP Plastics Holding |
| Choo Bee vs. Press Metal Bhd | Choo Bee vs. Shangri La Hotels | Choo Bee vs. Cengild Medical Berhad | Choo Bee vs. Mercury Industries 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 Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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