Correlation Between Media Prima and Asia Media
Can any of the company-specific risk be diversified away by investing in both Media Prima and Asia Media 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 Media Prima and Asia Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Media Prima Bhd and Asia Media Group, you can compare the effects of market volatilities on Media Prima and Asia Media 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 Media Prima with a short position of Asia Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Media Prima and Asia Media.
Diversification Opportunities for Media Prima and Asia Media
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Media and Asia is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Media Prima Bhd and Asia Media Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Media Group and Media Prima 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 Media Prima Bhd are associated (or correlated) with Asia Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Media Group has no effect on the direction of Media Prima i.e., Media Prima and Asia Media go up and down completely randomly.
Pair Corralation between Media Prima and Asia Media
Assuming the 90 days trading horizon Media Prima Bhd is expected to generate 0.18 times more return on investment than Asia Media. However, Media Prima Bhd is 5.47 times less risky than Asia Media. It trades about 0.03 of its potential returns per unit of risk. Asia Media Group is currently generating about -0.01 per unit of risk. If you would invest 46.00 in Media Prima Bhd on September 2, 2024 and sell it today you would earn a total of 1.00 from holding Media Prima Bhd or generate 2.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Media Prima Bhd vs. Asia Media Group
Performance |
| Timeline |
| Media Prima Bhd |
| Asia Media Group |
Media Prima and Asia Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Media Prima and Asia Media
The main advantage of trading using opposite Media Prima and Asia Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Media Prima position performs unexpectedly, Asia Media 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 Asia Media will offset losses from the drop in Asia Media's long position.| Media Prima vs. Binasat Communications Bhd | Media Prima vs. PIE Industrial Bhd | Media Prima vs. Star Media Group | Media Prima vs. Petronas Chemicals Group |
| Asia Media vs. JF Technology BHD | Asia Media vs. YX Precious Metals | Asia Media vs. Kossan Rubber Industries | Asia Media vs. Sports Toto 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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