Correlation Between JAKS Resources and Malayan Banking
Can any of the company-specific risk be diversified away by investing in both JAKS Resources and Malayan Banking 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 JAKS Resources and Malayan Banking into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JAKS Resources Bhd and Malayan Banking Bhd, you can compare the effects of market volatilities on JAKS Resources and Malayan Banking 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 JAKS Resources with a short position of Malayan Banking. Check out your portfolio center. Please also check ongoing floating volatility patterns of JAKS Resources and Malayan Banking.
Diversification Opportunities for JAKS Resources and Malayan Banking
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between JAKS and Malayan is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding JAKS Resources Bhd and Malayan Banking Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Malayan Banking Bhd and JAKS 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 JAKS Resources Bhd are associated (or correlated) with Malayan Banking. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Malayan Banking Bhd has no effect on the direction of JAKS Resources i.e., JAKS Resources and Malayan Banking go up and down completely randomly.
Pair Corralation between JAKS Resources and Malayan Banking
Assuming the 90 days trading horizon JAKS Resources Bhd is expected to generate 5.7 times more return on investment than Malayan Banking. However, JAKS Resources is 5.7 times more volatile than Malayan Banking Bhd. It trades about 0.02 of its potential returns per unit of risk. Malayan Banking Bhd is currently generating about -0.15 per unit of risk. If you would invest 13.00 in JAKS Resources Bhd on August 30, 2024 and sell it today you would earn a total of 0.00 from holding JAKS Resources Bhd or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JAKS Resources Bhd vs. Malayan Banking Bhd
Performance |
| Timeline |
| JAKS Resources Bhd |
| Malayan Banking Bhd |
JAKS Resources and Malayan Banking Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JAKS Resources and Malayan Banking
The main advantage of trading using opposite JAKS Resources and Malayan Banking positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JAKS Resources position performs unexpectedly, Malayan Banking 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 Malayan Banking will offset losses from the drop in Malayan Banking's long position.| JAKS Resources vs. Malayan Banking Bhd | JAKS Resources vs. Duopharma Biotech Bhd | JAKS Resources vs. PMB Technology Bhd | JAKS Resources vs. Petronas Chemicals Group |
| Malayan Banking vs. Southern Steel Bhd | Malayan Banking vs. Greatech Technology Bhd | Malayan Banking vs. Mycron Steel Bhd | Malayan Banking vs. Sunzen Biotech 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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