Correlation Between OSK Holdings and Sapura Energy
Can any of the company-specific risk be diversified away by investing in both OSK Holdings and Sapura Energy 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 OSK Holdings and Sapura Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OSK Holdings Bhd and Sapura Energy Bhd, you can compare the effects of market volatilities on OSK Holdings and Sapura Energy 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 OSK Holdings with a short position of Sapura Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of OSK Holdings and Sapura Energy.
Diversification Opportunities for OSK Holdings and Sapura Energy
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between OSK and Sapura is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding OSK Holdings Bhd and Sapura Energy Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sapura Energy Bhd and OSK Holdings 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 OSK Holdings Bhd are associated (or correlated) with Sapura Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sapura Energy Bhd has no effect on the direction of OSK Holdings i.e., OSK Holdings and Sapura Energy go up and down completely randomly.
Pair Corralation between OSK Holdings and Sapura Energy
Assuming the 90 days trading horizon OSK Holdings is expected to generate 6.36 times less return on investment than Sapura Energy. But when comparing it to its historical volatility, OSK Holdings Bhd is 8.62 times less risky than Sapura Energy. It trades about 0.08 of its potential returns per unit of risk. Sapura Energy Bhd is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 3.50 in Sapura Energy Bhd on November 2, 2024 and sell it today you would earn a total of 0.00 from holding Sapura Energy Bhd or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
OSK Holdings Bhd vs. Sapura Energy Bhd
Performance |
| Timeline |
| OSK Holdings Bhd |
| Sapura Energy Bhd |
OSK Holdings and Sapura Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OSK Holdings and Sapura Energy
The main advantage of trading using opposite OSK Holdings and Sapura Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OSK Holdings position performs unexpectedly, Sapura Energy 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 Sapura Energy will offset losses from the drop in Sapura Energy's long position.| OSK Holdings vs. Eonmetall Group Bhd | OSK Holdings vs. Cloudpoint Technology Berhad | OSK Holdings vs. MClean Technologies Bhd | OSK Holdings vs. Computer Forms Bhd |
| Sapura Energy vs. Malayan Banking Bhd | Sapura Energy vs. Public Bank Bhd | Sapura Energy vs. Petronas Chemicals Group | Sapura Energy vs. Tenaga Nasional 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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