Correlation Between Mycron Steel and Insas Bhd
Can any of the company-specific risk be diversified away by investing in both Mycron Steel and Insas 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 Mycron Steel and Insas Bhd into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mycron Steel Bhd and Insas Bhd, you can compare the effects of market volatilities on Mycron Steel and Insas 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 Mycron Steel with a short position of Insas Bhd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mycron Steel and Insas Bhd.
Diversification Opportunities for Mycron Steel and Insas Bhd
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Mycron and Insas is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Mycron Steel Bhd and Insas Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Insas Bhd and Mycron Steel 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 Mycron Steel Bhd are associated (or correlated) with Insas Bhd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Insas Bhd has no effect on the direction of Mycron Steel i.e., Mycron Steel and Insas Bhd go up and down completely randomly.
Pair Corralation between Mycron Steel and Insas Bhd
Assuming the 90 days trading horizon Mycron Steel is expected to generate 1.47 times less return on investment than Insas Bhd. In addition to that, Mycron Steel is 1.44 times more volatile than Insas Bhd. It trades about 0.01 of its total potential returns per unit of risk. Insas Bhd is currently generating about 0.03 per unit of volatility. If you would invest 88.00 in Insas Bhd on September 12, 2024 and sell it today you would earn a total of 8.00 from holding Insas Bhd or generate 9.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.59% |
| Values | Daily Returns |
Mycron Steel Bhd vs. Insas Bhd
Performance |
| Timeline |
| Mycron Steel Bhd |
| Insas Bhd |
Mycron Steel and Insas Bhd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mycron Steel and Insas Bhd
The main advantage of trading using opposite Mycron Steel and Insas Bhd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mycron Steel position performs unexpectedly, Insas 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 Insas Bhd will offset losses from the drop in Insas Bhd's long position.| Mycron Steel vs. Press Metal Bhd | Mycron Steel vs. PMB Technology Bhd | Mycron Steel vs. Pantech Group Holdings | Mycron Steel vs. CSC Steel Holdings |
| Insas Bhd vs. Mycron Steel Bhd | Insas Bhd vs. Aeon Credit Service | Insas Bhd vs. Malaysia Steel Works | Insas Bhd vs. Leader Steel Holdings |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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