Correlation Between Steel Hawk and Malayan Banking
Can any of the company-specific risk be diversified away by investing in both Steel Hawk 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 Steel Hawk and Malayan Banking into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Steel Hawk Berhad and Malayan Banking Bhd, you can compare the effects of market volatilities on Steel Hawk 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 Steel Hawk with a short position of Malayan Banking. Check out your portfolio center. Please also check ongoing floating volatility patterns of Steel Hawk and Malayan Banking.
Diversification Opportunities for Steel Hawk and Malayan Banking
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Steel and Malayan is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Steel Hawk Berhad 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 Steel Hawk 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 Steel Hawk Berhad 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 Steel Hawk i.e., Steel Hawk and Malayan Banking go up and down completely randomly.
Pair Corralation between Steel Hawk and Malayan Banking
Assuming the 90 days trading horizon Steel Hawk Berhad is expected to generate 22.14 times more return on investment than Malayan Banking. However, Steel Hawk is 22.14 times more volatile than Malayan Banking Bhd. It trades about 0.05 of its potential returns per unit of risk. Malayan Banking Bhd is currently generating about 0.1 per unit of risk. If you would invest 28.00 in Steel Hawk Berhad on November 7, 2024 and sell it today you would earn a total of 18.00 from holding Steel Hawk Berhad or generate 64.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Steel Hawk Berhad vs. Malayan Banking Bhd
Performance |
| Timeline |
| Steel Hawk Berhad |
| Malayan Banking Bhd |
Steel Hawk and Malayan Banking Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Steel Hawk and Malayan Banking
The main advantage of trading using opposite Steel Hawk and Malayan Banking positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Steel Hawk 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.| Steel Hawk vs. SSF Home Group | Steel Hawk vs. Cosmos Technology International | Steel Hawk vs. Senheng New Retail | Steel Hawk vs. YX Precious Metals |
| Malayan Banking vs. Computer Forms Bhd | Malayan Banking vs. Silver Ridge Holdings | Malayan Banking vs. Uchi Technologies Bhd | Malayan Banking vs. Mycron Steel 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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