Correlation Between Heineken Bhd and Public Bank
Can any of the company-specific risk be diversified away by investing in both Heineken Bhd and Public Bank 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 Heineken Bhd and Public Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Heineken Bhd and Public Bank Bhd, you can compare the effects of market volatilities on Heineken Bhd and Public Bank 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 Heineken Bhd with a short position of Public Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heineken Bhd and Public Bank.
Diversification Opportunities for Heineken Bhd and Public Bank
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Heineken and Public is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Heineken Bhd and Public Bank Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Public Bank Bhd and Heineken Bhd 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 Heineken Bhd are associated (or correlated) with Public Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Public Bank Bhd has no effect on the direction of Heineken Bhd i.e., Heineken Bhd and Public Bank go up and down completely randomly.
Pair Corralation between Heineken Bhd and Public Bank
Assuming the 90 days trading horizon Heineken Bhd is expected to generate 1.11 times more return on investment than Public Bank. However, Heineken Bhd is 1.11 times more volatile than Public Bank Bhd. It trades about 0.07 of its potential returns per unit of risk. Public Bank Bhd is currently generating about -0.06 per unit of risk. If you would invest 2,247 in Heineken Bhd on August 28, 2024 and sell it today you would earn a total of 127.00 from holding Heineken Bhd or generate 5.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heineken Bhd vs. Public Bank Bhd
Performance |
| Timeline |
| Heineken Bhd |
| Public Bank Bhd |
Heineken Bhd and Public Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heineken Bhd and Public Bank
The main advantage of trading using opposite Heineken Bhd and Public Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heineken Bhd position performs unexpectedly, Public Bank 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 Bank will offset losses from the drop in Public Bank's long position.| Heineken Bhd vs. Digistar Bhd | Heineken Bhd vs. Minetech Resources Bhd | Heineken Bhd vs. OpenSys M Bhd | Heineken Bhd vs. Insas Bhd |
| Public Bank vs. Privasia Technology Bhd | Public Bank vs. ONETECH SOLUTIONS HOLDINGS | Public Bank vs. Lysaght Galvanized Steel | Public Bank vs. PMB Technology 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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