Correlation Between Carlsberg Brewery and Bina Darulaman
Can any of the company-specific risk be diversified away by investing in both Carlsberg Brewery and Bina Darulaman 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 Bina Darulaman 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 Bina Darulaman Bhd, you can compare the effects of market volatilities on Carlsberg Brewery and Bina Darulaman 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 Bina Darulaman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carlsberg Brewery and Bina Darulaman.
Diversification Opportunities for Carlsberg Brewery and Bina Darulaman
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Carlsberg and Bina is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Carlsberg Brewery Malaysia and Bina Darulaman Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bina Darulaman 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 Bina Darulaman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bina Darulaman Bhd has no effect on the direction of Carlsberg Brewery i.e., Carlsberg Brewery and Bina Darulaman go up and down completely randomly.
Pair Corralation between Carlsberg Brewery and Bina Darulaman
Assuming the 90 days trading horizon Carlsberg Brewery Malaysia is expected to generate 0.29 times more return on investment than Bina Darulaman. However, Carlsberg Brewery Malaysia is 3.45 times less risky than Bina Darulaman. It trades about 0.06 of its potential returns per unit of risk. Bina Darulaman Bhd is currently generating about 0.02 per unit of risk. If you would invest 1,828 in Carlsberg Brewery Malaysia on September 2, 2024 and sell it today you would earn a total of 264.00 from holding Carlsberg Brewery Malaysia or generate 14.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.77% |
| Values | Daily Returns |
Carlsberg Brewery Malaysia vs. Bina Darulaman Bhd
Performance |
| Timeline |
| Carlsberg Brewery |
| Bina Darulaman Bhd |
Carlsberg Brewery and Bina Darulaman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carlsberg Brewery and Bina Darulaman
The main advantage of trading using opposite Carlsberg Brewery and Bina Darulaman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carlsberg Brewery position performs unexpectedly, Bina Darulaman 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 Bina Darulaman will offset losses from the drop in Bina Darulaman's long position.| Carlsberg Brewery vs. Digistar Bhd | Carlsberg Brewery vs. Swift Haulage Bhd | Carlsberg Brewery vs. Insas Bhd | Carlsberg Brewery vs. Kumpulan Kitacon Berhad |
| Bina Darulaman vs. Malayan Banking Bhd | Bina Darulaman vs. Public Bank Bhd | Bina Darulaman vs. Petronas Chemicals Group | Bina Darulaman vs. Tenaga Nasional 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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