Correlation Between Public Bank and Al Aqar
Can any of the company-specific risk be diversified away by investing in both Public Bank and Al Aqar 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 Public Bank and Al Aqar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Public Bank Bhd and Al Aqar Healthcare, you can compare the effects of market volatilities on Public Bank and Al Aqar 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 Public Bank with a short position of Al Aqar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Public Bank and Al Aqar.
Diversification Opportunities for Public Bank and Al Aqar
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Public and 5116 is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Public Bank Bhd and Al Aqar Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Al Aqar Healthcare and Public Bank 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 Public Bank Bhd are associated (or correlated) with Al Aqar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Al Aqar Healthcare has no effect on the direction of Public Bank i.e., Public Bank and Al Aqar go up and down completely randomly.
Pair Corralation between Public Bank and Al Aqar
Assuming the 90 days trading horizon Public Bank Bhd is expected to generate 1.14 times more return on investment than Al Aqar. However, Public Bank is 1.14 times more volatile than Al Aqar Healthcare. It trades about 0.05 of its potential returns per unit of risk. Al Aqar Healthcare is currently generating about 0.05 per unit of risk. If you would invest 403.00 in Public Bank Bhd on September 14, 2024 and sell it today you would earn a total of 54.00 from holding Public Bank Bhd or generate 13.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.62% |
| Values | Daily Returns |
Public Bank Bhd vs. Al Aqar Healthcare
Performance |
| Timeline |
| Public Bank Bhd |
| Al Aqar Healthcare |
Public Bank and Al Aqar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Public Bank and Al Aqar
The main advantage of trading using opposite Public Bank and Al Aqar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Public Bank position performs unexpectedly, Al Aqar 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 Al Aqar will offset losses from the drop in Al Aqar's long position.| Public Bank vs. Silver Ridge Holdings | Public Bank vs. Sports Toto Berhad | Public Bank vs. Apollo Food Holdings | Public Bank vs. TAS Offshore Bhd |
| Al Aqar vs. Eonmetall Group Bhd | Al Aqar vs. YX Precious Metals | Al Aqar vs. Public Bank Bhd | Al Aqar vs. IHH 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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