Correlation Between Tadmax Resources and Protasco Bhd
Can any of the company-specific risk be diversified away by investing in both Tadmax Resources and Protasco Bhd 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 Tadmax Resources and Protasco Bhd into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tadmax Resources Berhad and Protasco Bhd, you can compare the effects of market volatilities on Tadmax Resources and Protasco Bhd 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 Tadmax Resources with a short position of Protasco Bhd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tadmax Resources and Protasco Bhd.
Diversification Opportunities for Tadmax Resources and Protasco Bhd
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Tadmax and Protasco is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Tadmax Resources Berhad and Protasco Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Protasco Bhd and Tadmax Resources 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 Tadmax Resources Berhad are associated (or correlated) with Protasco Bhd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Protasco Bhd has no effect on the direction of Tadmax Resources i.e., Tadmax Resources and Protasco Bhd go up and down completely randomly.
Pair Corralation between Tadmax Resources and Protasco Bhd
Assuming the 90 days trading horizon Tadmax Resources Berhad is expected to under-perform the Protasco Bhd. But the stock apears to be less risky and, when comparing its historical volatility, Tadmax Resources Berhad is 1.5 times less risky than Protasco Bhd. The stock trades about -0.07 of its potential returns per unit of risk. The Protasco Bhd is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 29.00 in Protasco Bhd on November 2, 2024 and sell it today you would earn a total of 6.00 from holding Protasco Bhd or generate 20.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tadmax Resources Berhad vs. Protasco Bhd
Performance |
| Timeline |
| Tadmax Resources Berhad |
| Protasco Bhd |
Tadmax Resources and Protasco Bhd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tadmax Resources and Protasco Bhd
The main advantage of trading using opposite Tadmax Resources and Protasco Bhd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tadmax Resources position performs unexpectedly, Protasco Bhd 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 Protasco Bhd will offset losses from the drop in Protasco Bhd's long position.| Tadmax Resources vs. Sunway Construction Group | Tadmax Resources vs. JAKS Resources Bhd | Tadmax Resources vs. PESTECH International Bhd | Tadmax Resources vs. Pesona Metro Holdings |
| Protasco Bhd vs. Sunway Construction Group | Protasco Bhd vs. JAKS Resources Bhd | Protasco Bhd vs. PESTECH International Bhd | Protasco Bhd vs. Tadmax Resources Berhad |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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