Correlation Between Malayan Banking and JAKS Resources
Can any of the company-specific risk be diversified away by investing in both Malayan Banking and JAKS Resources 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 JAKS Resources 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 JAKS Resources Bhd, you can compare the effects of market volatilities on Malayan Banking and JAKS Resources 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 JAKS Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Malayan Banking and JAKS Resources.
Diversification Opportunities for Malayan Banking and JAKS Resources
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Malayan and JAKS is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Malayan Banking Bhd and JAKS Resources Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JAKS Resources 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 JAKS Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JAKS Resources Bhd has no effect on the direction of Malayan Banking i.e., Malayan Banking and JAKS Resources go up and down completely randomly.
Pair Corralation between Malayan Banking and JAKS Resources
Assuming the 90 days trading horizon Malayan Banking Bhd is expected to generate 0.15 times more return on investment than JAKS Resources. However, Malayan Banking Bhd is 6.53 times less risky than JAKS Resources. It trades about 0.11 of its potential returns per unit of risk. JAKS Resources Bhd is currently generating about -0.02 per unit of risk. If you would invest 760.00 in Malayan Banking Bhd on August 29, 2024 and sell it today you would earn a total of 258.00 from holding Malayan Banking Bhd or generate 33.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Malayan Banking Bhd vs. JAKS Resources Bhd
Performance |
| Timeline |
| Malayan Banking Bhd |
| JAKS Resources Bhd |
Malayan Banking and JAKS Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Malayan Banking and JAKS Resources
The main advantage of trading using opposite Malayan Banking and JAKS Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Malayan Banking position performs unexpectedly, JAKS Resources 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 JAKS Resources will offset losses from the drop in JAKS Resources' long position.| Malayan Banking vs. Southern Steel Bhd | Malayan Banking vs. Greatech Technology Bhd | Malayan Banking vs. Mycron Steel Bhd | Malayan Banking vs. Sunzen Biotech Bhd |
| JAKS Resources vs. Malayan Banking Bhd | JAKS Resources vs. Duopharma Biotech Bhd | JAKS Resources vs. PMB Technology Bhd | JAKS Resources vs. Petronas Chemicals 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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