Correlation Between Cosmos Technology and Malayan Banking
Can any of the company-specific risk be diversified away by investing in both Cosmos Technology and Malayan Banking 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 Cosmos Technology and Malayan Banking into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cosmos Technology International and Malayan Banking Bhd, you can compare the effects of market volatilities on Cosmos Technology and Malayan Banking 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 Cosmos Technology with a short position of Malayan Banking. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cosmos Technology and Malayan Banking.
Diversification Opportunities for Cosmos Technology and Malayan Banking
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Cosmos and Malayan is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Cosmos Technology Internationa and Malayan Banking Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Malayan Banking Bhd and Cosmos 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 Cosmos Technology International are associated (or correlated) with Malayan Banking. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Malayan Banking Bhd has no effect on the direction of Cosmos Technology i.e., Cosmos Technology and Malayan Banking go up and down completely randomly.
Pair Corralation between Cosmos Technology and Malayan Banking
Assuming the 90 days trading horizon Cosmos Technology International is expected to under-perform the Malayan Banking. In addition to that, Cosmos Technology is 2.78 times more volatile than Malayan Banking Bhd. It trades about -0.05 of its total potential returns per unit of risk. Malayan Banking Bhd is currently generating about -0.05 per unit of volatility. If you would invest 1,040 in Malayan Banking Bhd on August 28, 2024 and sell it today you would lose (10.00) from holding Malayan Banking Bhd or give up 0.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cosmos Technology Internationa vs. Malayan Banking Bhd
Performance |
| Timeline |
| Cosmos Technology |
| Malayan Banking Bhd |
Cosmos Technology and Malayan Banking Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cosmos Technology and Malayan Banking
The main advantage of trading using opposite Cosmos Technology and Malayan Banking positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cosmos Technology position performs unexpectedly, Malayan Banking 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 Malayan Banking will offset losses from the drop in Malayan Banking's long position.| Cosmos Technology vs. Malayan Banking Bhd | Cosmos Technology vs. Public Bank Bhd | Cosmos Technology vs. Petronas Chemicals Group | Cosmos Technology vs. Tenaga Nasional Bhd |
| Malayan Banking vs. Cengild Medical Berhad | Malayan Banking vs. YX Precious Metals | Malayan Banking vs. Melewar Industrial Group | Malayan Banking vs. Petronas Chemicals Group |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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