Correlation Between Cloudpoint Technology and Al Aqar
Can any of the company-specific risk be diversified away by investing in both Cloudpoint Technology and Al Aqar 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 Cloudpoint Technology and Al Aqar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cloudpoint Technology Berhad and Al Aqar Healthcare, you can compare the effects of market volatilities on Cloudpoint Technology and Al Aqar 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 Cloudpoint Technology with a short position of Al Aqar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cloudpoint Technology and Al Aqar.
Diversification Opportunities for Cloudpoint Technology and Al Aqar
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cloudpoint and 5116 is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Cloudpoint Technology Berhad and Al Aqar Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Al Aqar Healthcare and Cloudpoint 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 Cloudpoint Technology Berhad are associated (or correlated) with Al Aqar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Al Aqar Healthcare has no effect on the direction of Cloudpoint Technology i.e., Cloudpoint Technology and Al Aqar go up and down completely randomly.
Pair Corralation between Cloudpoint Technology and Al Aqar
Assuming the 90 days trading horizon Cloudpoint Technology Berhad is expected to generate 3.05 times more return on investment than Al Aqar. However, Cloudpoint Technology is 3.05 times more volatile than Al Aqar Healthcare. It trades about 0.07 of its potential returns per unit of risk. Al Aqar Healthcare is currently generating about 0.0 per unit of risk. If you would invest 80.00 in Cloudpoint Technology Berhad on November 2, 2024 and sell it today you would earn a total of 14.00 from holding Cloudpoint Technology Berhad or generate 17.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cloudpoint Technology Berhad vs. Al Aqar Healthcare
Performance |
| Timeline |
| Cloudpoint Technology |
| Al Aqar Healthcare |
Cloudpoint Technology and Al Aqar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cloudpoint Technology and Al Aqar
The main advantage of trading using opposite Cloudpoint Technology and Al Aqar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cloudpoint Technology position performs unexpectedly, Al Aqar 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 Al Aqar will offset losses from the drop in Al Aqar's long position.| Cloudpoint Technology vs. Binasat Communications Bhd | Cloudpoint Technology vs. Kawan Food Bhd | Cloudpoint Technology vs. Hong Leong Bank | Cloudpoint Technology vs. Ho Hup Construction |
| Al Aqar vs. Awanbiru Technology Bhd | Al Aqar vs. Public Bank Bhd | Al Aqar vs. Malayan Banking Bhd | Al Aqar vs. Bank Islam Malaysia |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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