Correlation Between Sungei Bagan and Protasco Bhd
Can any of the company-specific risk be diversified away by investing in both Sungei Bagan and Protasco Bhd 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 Protasco Bhd 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 Protasco Bhd, you can compare the effects of market volatilities on Sungei Bagan and Protasco Bhd 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 Protasco Bhd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sungei Bagan and Protasco Bhd.
Diversification Opportunities for Sungei Bagan and Protasco Bhd
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sungei and Protasco is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Sungei Bagan Rubber and Protasco Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Protasco Bhd 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 Protasco Bhd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Protasco Bhd has no effect on the direction of Sungei Bagan i.e., Sungei Bagan and Protasco Bhd go up and down completely randomly.
Pair Corralation between Sungei Bagan and Protasco Bhd
Assuming the 90 days trading horizon Sungei Bagan Rubber is expected to generate 0.3 times more return on investment than Protasco Bhd. However, Sungei Bagan Rubber is 3.3 times less risky than Protasco Bhd. It trades about 0.2 of its potential returns per unit of risk. Protasco Bhd is currently generating about 0.01 per unit of risk. If you would invest 530.00 in Sungei Bagan Rubber on October 20, 2024 and sell it today you would earn a total of 21.00 from holding Sungei Bagan Rubber or generate 3.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sungei Bagan Rubber vs. Protasco Bhd
Performance |
| Timeline |
| Sungei Bagan Rubber |
| Protasco Bhd |
Sungei Bagan and Protasco Bhd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sungei Bagan and Protasco Bhd
The main advantage of trading using opposite Sungei Bagan and Protasco Bhd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sungei Bagan position performs unexpectedly, Protasco Bhd 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 Protasco Bhd will offset losses from the drop in Protasco Bhd's long position.| Sungei Bagan vs. Public Packages Holdings | Sungei Bagan vs. YX Precious Metals | Sungei Bagan vs. Icon Offshore Bhd | Sungei Bagan vs. Press Metal Bhd |
| Protasco Bhd vs. Sapura Industrial Bhd | Protasco Bhd vs. Sungei Bagan Rubber | Protasco Bhd vs. Mercury Industries Bhd | Protasco Bhd vs. Al Aqar Healthcare |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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