Correlation Between Cloudpoint Technology and Pesona Metro
Can any of the company-specific risk be diversified away by investing in both Cloudpoint Technology and Pesona Metro 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 Pesona Metro 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 Pesona Metro Holdings, you can compare the effects of market volatilities on Cloudpoint Technology and Pesona Metro 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 Pesona Metro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cloudpoint Technology and Pesona Metro.
Diversification Opportunities for Cloudpoint Technology and Pesona Metro
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Cloudpoint and Pesona is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Cloudpoint Technology Berhad and Pesona Metro Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pesona Metro Holdings 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 Pesona Metro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pesona Metro Holdings has no effect on the direction of Cloudpoint Technology i.e., Cloudpoint Technology and Pesona Metro go up and down completely randomly.
Pair Corralation between Cloudpoint Technology and Pesona Metro
Assuming the 90 days trading horizon Cloudpoint Technology is expected to generate 2.88 times less return on investment than Pesona Metro. But when comparing it to its historical volatility, Cloudpoint Technology Berhad is 1.06 times less risky than Pesona Metro. It trades about 0.08 of its potential returns per unit of risk. Pesona Metro Holdings is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 24.00 in Pesona Metro Holdings on August 28, 2024 and sell it today you would earn a total of 3.00 from holding Pesona Metro Holdings or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cloudpoint Technology Berhad vs. Pesona Metro Holdings
Performance |
| Timeline |
| Cloudpoint Technology |
| Pesona Metro Holdings |
Cloudpoint Technology and Pesona Metro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cloudpoint Technology and Pesona Metro
The main advantage of trading using opposite Cloudpoint Technology and Pesona Metro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cloudpoint Technology position performs unexpectedly, Pesona Metro 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 Pesona Metro will offset losses from the drop in Pesona Metro's long position.| Cloudpoint Technology vs. Malayan Banking Bhd | Cloudpoint Technology vs. Public Bank Bhd | Cloudpoint Technology vs. Petronas Chemicals Group | Cloudpoint Technology vs. Tenaga Nasional Bhd |
| Pesona Metro vs. Rubberex M | Pesona Metro vs. Cloudpoint Technology Berhad | Pesona Metro vs. Choo Bee Metal | Pesona Metro vs. EA Technique M |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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