Correlation Between Malayan Banking and MClean Technologies
Can any of the company-specific risk be diversified away by investing in both Malayan Banking and MClean Technologies 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 Malayan Banking and MClean Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Malayan Banking Bhd and MClean Technologies Bhd, you can compare the effects of market volatilities on Malayan Banking and MClean Technologies 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 Malayan Banking with a short position of MClean Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Malayan Banking and MClean Technologies.
Diversification Opportunities for Malayan Banking and MClean Technologies
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Malayan and MClean is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Malayan Banking Bhd and MClean Technologies Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MClean Technologies Bhd and Malayan Banking 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 Malayan Banking Bhd are associated (or correlated) with MClean Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MClean Technologies Bhd has no effect on the direction of Malayan Banking i.e., Malayan Banking and MClean Technologies go up and down completely randomly.
Pair Corralation between Malayan Banking and MClean Technologies
Assuming the 90 days trading horizon Malayan Banking Bhd is expected to generate 0.17 times more return on investment than MClean Technologies. However, Malayan Banking Bhd is 5.75 times less risky than MClean Technologies. It trades about -0.09 of its potential returns per unit of risk. MClean Technologies Bhd is currently generating about -0.07 per unit of risk. If you would invest 1,048 in Malayan Banking Bhd on August 30, 2024 and sell it today you would lose (30.00) from holding Malayan Banking Bhd or give up 2.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Malayan Banking Bhd vs. MClean Technologies Bhd
Performance |
| Timeline |
| Malayan Banking Bhd |
| MClean Technologies Bhd |
Malayan Banking and MClean Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Malayan Banking and MClean Technologies
The main advantage of trading using opposite Malayan Banking and MClean Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Malayan Banking position performs unexpectedly, MClean Technologies 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 MClean Technologies will offset losses from the drop in MClean Technologies' long position.| Malayan Banking vs. PIE Industrial Bhd | Malayan Banking vs. Press Metal Bhd | Malayan Banking vs. Binasat Communications Bhd | Malayan Banking vs. Choo Bee Metal |
| MClean Technologies vs. Uchi Technologies Bhd | MClean Technologies vs. Greatech Technology Bhd | MClean Technologies vs. K One Technology Bhd | MClean Technologies vs. PMB Technology 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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