Correlation Between SFP Tech and EA Technique
Can any of the company-specific risk be diversified away by investing in both SFP Tech and EA Technique 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 SFP Tech and EA Technique into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SFP Tech Holdings and EA Technique M, you can compare the effects of market volatilities on SFP Tech and EA Technique 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 SFP Tech with a short position of EA Technique. Check out your portfolio center. Please also check ongoing floating volatility patterns of SFP Tech and EA Technique.
Diversification Opportunities for SFP Tech and EA Technique
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SFP and 5259 is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding SFP Tech Holdings and EA Technique M in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EA Technique M and SFP Tech 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 SFP Tech Holdings are associated (or correlated) with EA Technique. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EA Technique M has no effect on the direction of SFP Tech i.e., SFP Tech and EA Technique go up and down completely randomly.
Pair Corralation between SFP Tech and EA Technique
Assuming the 90 days trading horizon SFP Tech Holdings is expected to under-perform the EA Technique. But the stock apears to be less risky and, when comparing its historical volatility, SFP Tech Holdings is 1.39 times less risky than EA Technique. The stock trades about -0.03 of its potential returns per unit of risk. The EA Technique M is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 25.00 in EA Technique M on September 1, 2024 and sell it today you would earn a total of 5.00 from holding EA Technique M or generate 20.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SFP Tech Holdings vs. EA Technique M
Performance |
| Timeline |
| SFP Tech Holdings |
| EA Technique M |
SFP Tech and EA Technique Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SFP Tech and EA Technique
The main advantage of trading using opposite SFP Tech and EA Technique positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SFP Tech position performs unexpectedly, EA Technique 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 EA Technique will offset losses from the drop in EA Technique's long position.| SFP Tech vs. Lotte Chemical Titan | SFP Tech vs. Sports Toto Berhad | SFP Tech vs. Media Prima Bhd | SFP Tech vs. YX Precious Metals |
| EA Technique vs. Kobay Tech Bhd | EA Technique vs. CPE Technology Berhad | EA Technique vs. Star Media Group | EA Technique vs. Resintech 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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