Correlation Between Carlsberg Brewery and EA Technique
Can any of the company-specific risk be diversified away by investing in both Carlsberg Brewery and EA Technique 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 EA Technique 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 EA Technique M, you can compare the effects of market volatilities on Carlsberg Brewery and EA Technique 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 EA Technique. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carlsberg Brewery and EA Technique.
Diversification Opportunities for Carlsberg Brewery and EA Technique
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Carlsberg and 5259 is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Carlsberg Brewery Malaysia and EA Technique M in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EA Technique M 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 EA Technique. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EA Technique M has no effect on the direction of Carlsberg Brewery i.e., Carlsberg Brewery and EA Technique go up and down completely randomly.
Pair Corralation between Carlsberg Brewery and EA Technique
Assuming the 90 days trading horizon Carlsberg Brewery Malaysia is expected to generate 0.6 times more return on investment than EA Technique. However, Carlsberg Brewery Malaysia is 1.68 times less risky than EA Technique. It trades about 0.15 of its potential returns per unit of risk. EA Technique M is currently generating about 0.01 per unit of risk. If you would invest 1,879 in Carlsberg Brewery Malaysia on August 28, 2024 and sell it today you would earn a total of 181.00 from holding Carlsberg Brewery Malaysia or generate 9.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Carlsberg Brewery Malaysia vs. EA Technique M
Performance |
| Timeline |
| Carlsberg Brewery |
| EA Technique M |
Carlsberg Brewery and EA Technique Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carlsberg Brewery and EA Technique
The main advantage of trading using opposite Carlsberg Brewery and EA Technique positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carlsberg Brewery position performs unexpectedly, EA Technique 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 EA Technique will offset losses from the drop in EA Technique's long position.| Carlsberg Brewery vs. Digistar Bhd | Carlsberg Brewery vs. Minetech Resources Bhd | Carlsberg Brewery vs. OpenSys M Bhd | Carlsberg Brewery vs. Insas Bhd |
| EA Technique vs. HeiTech Padu Bhd | EA Technique vs. Lysaght Galvanized Steel | EA Technique vs. Digistar Bhd | EA Technique vs. Swift Haulage 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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