Correlation Between DC HEALTHCARE and YTL Hospitality
Can any of the company-specific risk be diversified away by investing in both DC HEALTHCARE and YTL Hospitality 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 DC HEALTHCARE and YTL Hospitality into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DC HEALTHCARE HOLDINGS and YTL Hospitality REIT, you can compare the effects of market volatilities on DC HEALTHCARE and YTL Hospitality 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 DC HEALTHCARE with a short position of YTL Hospitality. Check out your portfolio center. Please also check ongoing floating volatility patterns of DC HEALTHCARE and YTL Hospitality.
Diversification Opportunities for DC HEALTHCARE and YTL Hospitality
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between 0283 and YTL is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding DC HEALTHCARE HOLDINGS and YTL Hospitality REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YTL Hospitality REIT and DC HEALTHCARE 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 DC HEALTHCARE HOLDINGS are associated (or correlated) with YTL Hospitality. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YTL Hospitality REIT has no effect on the direction of DC HEALTHCARE i.e., DC HEALTHCARE and YTL Hospitality go up and down completely randomly.
Pair Corralation between DC HEALTHCARE and YTL Hospitality
Assuming the 90 days trading horizon DC HEALTHCARE HOLDINGS is expected to generate 113.65 times more return on investment than YTL Hospitality. However, DC HEALTHCARE is 113.65 times more volatile than YTL Hospitality REIT. It trades about 0.1 of its potential returns per unit of risk. YTL Hospitality REIT is currently generating about 0.08 per unit of risk. If you would invest 45.00 in DC HEALTHCARE HOLDINGS on September 14, 2024 and sell it today you would lose (27.00) from holding DC HEALTHCARE HOLDINGS or give up 60.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 73.71% |
| Values | Daily Returns |
DC HEALTHCARE HOLDINGS vs. YTL Hospitality REIT
Performance |
| Timeline |
| DC HEALTHCARE HOLDINGS |
| YTL Hospitality REIT |
DC HEALTHCARE and YTL Hospitality Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DC HEALTHCARE and YTL Hospitality
The main advantage of trading using opposite DC HEALTHCARE and YTL Hospitality positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DC HEALTHCARE position performs unexpectedly, YTL Hospitality 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 YTL Hospitality will offset losses from the drop in YTL Hospitality's long position.| DC HEALTHCARE vs. Malayan Banking Bhd | DC HEALTHCARE vs. Public Bank Bhd | DC HEALTHCARE vs. Petronas Chemicals Group | DC HEALTHCARE vs. Tenaga Nasional Bhd |
| YTL Hospitality vs. Senheng New Retail | YTL Hospitality vs. CSC Steel Holdings | YTL Hospitality vs. Carlsberg Brewery Malaysia | YTL Hospitality vs. Apex Healthcare 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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