Correlation Between Carlsberg Brewery and PPB Group
Can any of the company-specific risk be diversified away by investing in both Carlsberg Brewery and PPB Group 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 Carlsberg Brewery and PPB Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carlsberg Brewery Malaysia and PPB Group Bhd, you can compare the effects of market volatilities on Carlsberg Brewery and PPB Group 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 Carlsberg Brewery with a short position of PPB Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carlsberg Brewery and PPB Group.
Diversification Opportunities for Carlsberg Brewery and PPB Group
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Carlsberg and PPB is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Carlsberg Brewery Malaysia and PPB Group Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PPB Group Bhd and Carlsberg Brewery 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 Carlsberg Brewery Malaysia are associated (or correlated) with PPB Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PPB Group Bhd has no effect on the direction of Carlsberg Brewery i.e., Carlsberg Brewery and PPB Group go up and down completely randomly.
Pair Corralation between Carlsberg Brewery and PPB Group
Assuming the 90 days trading horizon Carlsberg Brewery Malaysia is expected to generate 0.43 times more return on investment than PPB Group. However, Carlsberg Brewery Malaysia is 2.31 times less risky than PPB Group. It trades about 0.26 of its potential returns per unit of risk. PPB Group Bhd is currently generating about -0.33 per unit of risk. If you would invest 1,978 in Carlsberg Brewery Malaysia on September 12, 2024 and sell it today you would earn a total of 72.00 from holding Carlsberg Brewery Malaysia or generate 3.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Carlsberg Brewery Malaysia vs. PPB Group Bhd
Performance |
| Timeline |
| Carlsberg Brewery |
| PPB Group Bhd |
Carlsberg Brewery and PPB Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carlsberg Brewery and PPB Group
The main advantage of trading using opposite Carlsberg Brewery and PPB Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carlsberg Brewery position performs unexpectedly, PPB Group 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 PPB Group will offset losses from the drop in PPB Group's long position.| Carlsberg Brewery vs. Al Aqar Healthcare | Carlsberg Brewery vs. PMB Technology Bhd | Carlsberg Brewery vs. Digistar Bhd | Carlsberg Brewery vs. Minetech Resources Bhd |
| PPB Group vs. Nestle Bhd | PPB Group vs. British American Tobacco | PPB Group vs. FARM FRESH BERHAD | PPB Group vs. Kawan Food 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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