Correlation Between SSF Home and Melewar Industrial
Can any of the company-specific risk be diversified away by investing in both SSF Home and Melewar Industrial 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 SSF Home and Melewar Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SSF Home Group and Melewar Industrial Group, you can compare the effects of market volatilities on SSF Home and Melewar Industrial 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 SSF Home with a short position of Melewar Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of SSF Home and Melewar Industrial.
Diversification Opportunities for SSF Home and Melewar Industrial
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SSF and Melewar is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding SSF Home Group and Melewar Industrial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Melewar Industrial and SSF Home 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 SSF Home Group are associated (or correlated) with Melewar Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Melewar Industrial has no effect on the direction of SSF Home i.e., SSF Home and Melewar Industrial go up and down completely randomly.
Pair Corralation between SSF Home and Melewar Industrial
Assuming the 90 days trading horizon SSF Home Group is expected to generate 0.23 times more return on investment than Melewar Industrial. However, SSF Home Group is 4.28 times less risky than Melewar Industrial. It trades about 0.0 of its potential returns per unit of risk. Melewar Industrial Group is currently generating about -0.14 per unit of risk. If you would invest 38.00 in SSF Home Group on January 24, 2025 and sell it today you would earn a total of 0.00 from holding SSF Home Group or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SSF Home Group vs. Melewar Industrial Group
Performance |
| Timeline |
| SSF Home Group |
| Melewar Industrial |
SSF Home and Melewar Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SSF Home and Melewar Industrial
The main advantage of trading using opposite SSF Home and Melewar Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SSF Home position performs unexpectedly, Melewar Industrial 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 Melewar Industrial will offset losses from the drop in Melewar Industrial's long position.| SSF Home vs. MClean Technologies Bhd | SSF Home vs. Apex Healthcare Bhd | SSF Home vs. Leader Steel Holdings | SSF Home vs. Nova Wellness Group |
| Melewar Industrial vs. SSF Home Group | Melewar Industrial vs. Choo Bee Metal | Melewar Industrial vs. Homeritz Bhd | Melewar Industrial vs. Star Media 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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