Correlation Between Sports Toto and Genting Malaysia
Can any of the company-specific risk be diversified away by investing in both Sports Toto and Genting Malaysia 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 Sports Toto and Genting Malaysia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sports Toto Berhad and Genting Malaysia Bhd, you can compare the effects of market volatilities on Sports Toto and Genting Malaysia 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 Sports Toto with a short position of Genting Malaysia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sports Toto and Genting Malaysia.
Diversification Opportunities for Sports Toto and Genting Malaysia
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sports and Genting is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Sports Toto Berhad and Genting Malaysia Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genting Malaysia Bhd and Sports Toto 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 Sports Toto Berhad are associated (or correlated) with Genting Malaysia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genting Malaysia Bhd has no effect on the direction of Sports Toto i.e., Sports Toto and Genting Malaysia go up and down completely randomly.
Pair Corralation between Sports Toto and Genting Malaysia
Assuming the 90 days trading horizon Sports Toto Berhad is expected to generate 0.8 times more return on investment than Genting Malaysia. However, Sports Toto Berhad is 1.25 times less risky than Genting Malaysia. It trades about -0.11 of its potential returns per unit of risk. Genting Malaysia Bhd is currently generating about -0.14 per unit of risk. If you would invest 158.00 in Sports Toto Berhad on September 2, 2024 and sell it today you would lose (13.00) from holding Sports Toto Berhad or give up 8.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sports Toto Berhad vs. Genting Malaysia Bhd
Performance |
| Timeline |
| Sports Toto Berhad |
| Genting Malaysia Bhd |
Sports Toto and Genting Malaysia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sports Toto and Genting Malaysia
The main advantage of trading using opposite Sports Toto and Genting Malaysia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sports Toto position performs unexpectedly, Genting Malaysia 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 Genting Malaysia will offset losses from the drop in Genting Malaysia's long position.| Sports Toto vs. Digistar Bhd | Sports Toto vs. Minetech Resources Bhd | Sports Toto vs. Swift Haulage Bhd | Sports Toto vs. Bina Darulaman Bhd |
| Genting Malaysia vs. Digistar Bhd | Genting Malaysia vs. Minetech Resources Bhd | Genting Malaysia vs. Swift Haulage Bhd | Genting Malaysia vs. Bina Darulaman 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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