Correlation Between YX Precious and RHB Bank
Can any of the company-specific risk be diversified away by investing in both YX Precious and RHB Bank 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 YX Precious and RHB Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YX Precious Metals and RHB Bank Bhd, you can compare the effects of market volatilities on YX Precious and RHB Bank 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 YX Precious with a short position of RHB Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of YX Precious and RHB Bank.
Diversification Opportunities for YX Precious and RHB Bank
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between 0250 and RHB is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding YX Precious Metals and RHB Bank Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RHB Bank Bhd and YX Precious 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 YX Precious Metals are associated (or correlated) with RHB Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RHB Bank Bhd has no effect on the direction of YX Precious i.e., YX Precious and RHB Bank go up and down completely randomly.
Pair Corralation between YX Precious and RHB Bank
Assuming the 90 days trading horizon YX Precious Metals is expected to generate 1.83 times more return on investment than RHB Bank. However, YX Precious is 1.83 times more volatile than RHB Bank Bhd. It trades about 0.01 of its potential returns per unit of risk. RHB Bank Bhd is currently generating about -0.01 per unit of risk. If you would invest 24.00 in YX Precious Metals on October 22, 2024 and sell it today you would earn a total of 0.00 from holding YX Precious Metals 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 |
YX Precious Metals vs. RHB Bank Bhd
Performance |
| Timeline |
| YX Precious Metals |
| RHB Bank Bhd |
YX Precious and RHB Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YX Precious and RHB Bank
The main advantage of trading using opposite YX Precious and RHB Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YX Precious position performs unexpectedly, RHB Bank 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 RHB Bank will offset losses from the drop in RHB Bank's long position.| YX Precious vs. Dufu Tech Corp | YX Precious vs. Radiant Globaltech Bhd | YX Precious vs. ECM Libra Financial | YX Precious vs. Uchi Technologies Bhd |
| RHB Bank vs. Senheng New Retail | RHB Bank vs. Apex Healthcare Bhd | RHB Bank vs. Daya Materials Bhd | RHB Bank vs. Al Aqar Healthcare |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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