Correlation Between Sungei Bagan and Malaysian Resources
Can any of the company-specific risk be diversified away by investing in both Sungei Bagan and Malaysian 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 Sungei Bagan and Malaysian Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sungei Bagan Rubber and Malaysian Resources, you can compare the effects of market volatilities on Sungei Bagan and Malaysian 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 Sungei Bagan with a short position of Malaysian Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sungei Bagan and Malaysian Resources.
Diversification Opportunities for Sungei Bagan and Malaysian Resources
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sungei and Malaysian is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Sungei Bagan Rubber and Malaysian Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Malaysian Resources and Sungei Bagan 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 Sungei Bagan Rubber are associated (or correlated) with Malaysian Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Malaysian Resources has no effect on the direction of Sungei Bagan i.e., Sungei Bagan and Malaysian Resources go up and down completely randomly.
Pair Corralation between Sungei Bagan and Malaysian Resources
If you would invest (100.00) in Malaysian Resources on September 3, 2024 and sell it today you would earn a total of 100.00 from holding Malaysian Resources or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Sungei Bagan Rubber vs. Malaysian Resources
Performance |
| Timeline |
| Sungei Bagan Rubber |
| Malaysian Resources |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Sungei Bagan and Malaysian Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sungei Bagan and Malaysian Resources
The main advantage of trading using opposite Sungei Bagan and Malaysian Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sungei Bagan position performs unexpectedly, Malaysian 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 Malaysian Resources will offset losses from the drop in Malaysian Resources' long position.| Sungei Bagan vs. British American Tobacco | Sungei Bagan vs. FARM FRESH BERHAD | Sungei Bagan vs. Apollo Food Holdings | Sungei Bagan vs. Oriental Food Industries |
| Malaysian Resources vs. Riverview Rubber Estates | Malaysian Resources vs. Farm Price Holdings | Malaysian Resources vs. Sports Toto Berhad | Malaysian Resources vs. Press Metal 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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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