Correlation Between Heineken Bhd and Minetech Resources
Can any of the company-specific risk be diversified away by investing in both Heineken Bhd and Minetech Resources 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 Minetech Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Heineken Bhd and Minetech Resources Bhd, you can compare the effects of market volatilities on Heineken Bhd and Minetech Resources 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 Minetech Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heineken Bhd and Minetech Resources.
Diversification Opportunities for Heineken Bhd and Minetech Resources
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Heineken and Minetech is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Heineken Bhd and Minetech Resources Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Minetech Resources 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 Minetech Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Minetech Resources Bhd has no effect on the direction of Heineken Bhd i.e., Heineken Bhd and Minetech Resources go up and down completely randomly.
Pair Corralation between Heineken Bhd and Minetech Resources
Assuming the 90 days trading horizon Heineken Bhd is expected to under-perform the Minetech Resources. But the stock apears to be less risky and, when comparing its historical volatility, Heineken Bhd is 8.74 times less risky than Minetech Resources. The stock trades about -0.13 of its potential returns per unit of risk. The Minetech Resources Bhd is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 13.00 in Minetech Resources Bhd on November 2, 2024 and sell it today you would earn a total of 0.00 from holding Minetech Resources Bhd or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heineken Bhd vs. Minetech Resources Bhd
Performance |
| Timeline |
| Heineken Bhd |
| Minetech Resources Bhd |
Heineken Bhd and Minetech Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heineken Bhd and Minetech Resources
The main advantage of trading using opposite Heineken Bhd and Minetech Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heineken Bhd position performs unexpectedly, Minetech Resources 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 Minetech Resources will offset losses from the drop in Minetech Resources' long position.| Heineken Bhd vs. Carlsberg Brewery Malaysia | Heineken Bhd vs. Nexgram Holdings Bhd | Heineken Bhd vs. Techfast Holdings Bhd |
| Minetech Resources vs. Star Media Group | Minetech Resources vs. Awanbiru Technology Bhd | Minetech Resources vs. Cosmos Technology International | Minetech Resources vs. Farm Price Holdings |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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