Correlation Between Carlsberg Brewery and Public Packages
Can any of the company-specific risk be diversified away by investing in both Carlsberg Brewery and Public Packages 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 Public Packages 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 Public Packages Holdings, you can compare the effects of market volatilities on Carlsberg Brewery and Public Packages 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 Public Packages. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carlsberg Brewery and Public Packages.
Diversification Opportunities for Carlsberg Brewery and Public Packages
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Carlsberg and Public is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Carlsberg Brewery Malaysia and Public Packages Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Public Packages Holdings 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 Public Packages. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Public Packages Holdings has no effect on the direction of Carlsberg Brewery i.e., Carlsberg Brewery and Public Packages go up and down completely randomly.
Pair Corralation between Carlsberg Brewery and Public Packages
Assuming the 90 days trading horizon Carlsberg Brewery Malaysia is expected to under-perform the Public Packages. But the stock apears to be less risky and, when comparing its historical volatility, Carlsberg Brewery Malaysia is 2.46 times less risky than Public Packages. The stock trades about -0.35 of its potential returns per unit of risk. The Public Packages Holdings is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest 82.00 in Public Packages Holdings on November 7, 2024 and sell it today you would lose (2.00) from holding Public Packages Holdings or give up 2.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Carlsberg Brewery Malaysia vs. Public Packages Holdings
Performance |
| Timeline |
| Carlsberg Brewery |
| Public Packages Holdings |
Carlsberg Brewery and Public Packages Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carlsberg Brewery and Public Packages
The main advantage of trading using opposite Carlsberg Brewery and Public Packages positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carlsberg Brewery position performs unexpectedly, Public Packages 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 Public Packages will offset losses from the drop in Public Packages' long position.| Carlsberg Brewery vs. Heineken Bhd | Carlsberg Brewery vs. PESTECH International Bhd | Carlsberg Brewery vs. Uwc Bhd | Carlsberg Brewery vs. Genetec Technology Bhd |
| Public Packages vs. Sapura Industrial Bhd | Public Packages vs. Lysaght Galvanized Steel | Public Packages vs. Leader Steel Holdings | Public Packages vs. Eonmetall Group 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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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