Correlation Between TIME Dotcom and Farm Price
Can any of the company-specific risk be diversified away by investing in both TIME Dotcom and Farm Price 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 TIME Dotcom and Farm Price into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TIME Dotcom Bhd and Farm Price Holdings, you can compare the effects of market volatilities on TIME Dotcom and Farm Price 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 TIME Dotcom with a short position of Farm Price. Check out your portfolio center. Please also check ongoing floating volatility patterns of TIME Dotcom and Farm Price.
Diversification Opportunities for TIME Dotcom and Farm Price
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between TIME and Farm is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding TIME Dotcom Bhd and Farm Price Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Farm Price Holdings and TIME Dotcom 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 TIME Dotcom Bhd are associated (or correlated) with Farm Price. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Farm Price Holdings has no effect on the direction of TIME Dotcom i.e., TIME Dotcom and Farm Price go up and down completely randomly.
Pair Corralation between TIME Dotcom and Farm Price
Assuming the 90 days trading horizon TIME Dotcom Bhd is expected to generate 0.57 times more return on investment than Farm Price. However, TIME Dotcom Bhd is 1.75 times less risky than Farm Price. It trades about -0.01 of its potential returns per unit of risk. Farm Price Holdings is currently generating about -0.12 per unit of risk. If you would invest 490.00 in TIME Dotcom Bhd on October 25, 2024 and sell it today you would lose (15.00) from holding TIME Dotcom Bhd or give up 3.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.2% |
| Values | Daily Returns |
TIME Dotcom Bhd vs. Farm Price Holdings
Performance |
| Timeline |
| TIME Dotcom Bhd |
| Farm Price Holdings |
TIME Dotcom and Farm Price Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TIME Dotcom and Farm Price
The main advantage of trading using opposite TIME Dotcom and Farm Price positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TIME Dotcom position performs unexpectedly, Farm Price 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 Farm Price will offset losses from the drop in Farm Price's long position.| TIME Dotcom vs. Daya Materials Bhd | TIME Dotcom vs. IHH Healthcare Bhd | TIME Dotcom vs. Senheng New Retail | TIME Dotcom vs. Riverview Rubber Estates |
| Farm Price vs. Central Industrial Corp | Farm Price vs. SSF Home Group | Farm Price vs. Press Metal Bhd | Farm Price vs. Lysaght Galvanized Steel |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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