Correlation Between ECM Libra and Berjaya Food
Can any of the company-specific risk be diversified away by investing in both ECM Libra and Berjaya Food 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 ECM Libra and Berjaya Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ECM Libra Financial and Berjaya Food Bhd, you can compare the effects of market volatilities on ECM Libra and Berjaya Food 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 ECM Libra with a short position of Berjaya Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of ECM Libra and Berjaya Food.
Diversification Opportunities for ECM Libra and Berjaya Food
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between ECM and Berjaya is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding ECM Libra Financial and Berjaya Food Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berjaya Food Bhd and ECM Libra 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 ECM Libra Financial are associated (or correlated) with Berjaya Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Berjaya Food Bhd has no effect on the direction of ECM Libra i.e., ECM Libra and Berjaya Food go up and down completely randomly.
Pair Corralation between ECM Libra and Berjaya Food
Assuming the 90 days trading horizon ECM Libra is expected to generate 3.97 times less return on investment than Berjaya Food. In addition to that, ECM Libra is 1.03 times more volatile than Berjaya Food Bhd. It trades about 0.09 of its total potential returns per unit of risk. Berjaya Food Bhd is currently generating about 0.38 per unit of volatility. If you would invest 35.00 in Berjaya Food Bhd on October 23, 2024 and sell it today you would earn a total of 11.00 from holding Berjaya Food Bhd or generate 31.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ECM Libra Financial vs. Berjaya Food Bhd
Performance |
| Timeline |
| ECM Libra Financial |
| Berjaya Food Bhd |
ECM Libra and Berjaya Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ECM Libra and Berjaya Food
The main advantage of trading using opposite ECM Libra and Berjaya Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ECM Libra position performs unexpectedly, Berjaya Food 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 Berjaya Food will offset losses from the drop in Berjaya Food's long position.| ECM Libra vs. Press Metal Bhd | ECM Libra vs. ONETECH SOLUTIONS HOLDINGS | ECM Libra vs. YX Precious Metals | ECM Libra vs. Cosmos Technology International |
| Berjaya Food vs. Genting Malaysia Bhd | Berjaya Food vs. Shangri La Hotels | Berjaya Food vs. ECM Libra Financial | Berjaya Food vs. Genetec 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |