Correlation Between CSC Steel and Apex Healthcare
Can any of the company-specific risk be diversified away by investing in both CSC Steel and Apex Healthcare 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 CSC Steel and Apex Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CSC Steel Holdings and Apex Healthcare Bhd, you can compare the effects of market volatilities on CSC Steel and Apex Healthcare 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 CSC Steel with a short position of Apex Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSC Steel and Apex Healthcare.
Diversification Opportunities for CSC Steel and Apex Healthcare
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between CSC and Apex is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding CSC Steel Holdings and Apex Healthcare Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apex Healthcare Bhd and CSC 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 CSC Steel Holdings are associated (or correlated) with Apex Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apex Healthcare Bhd has no effect on the direction of CSC Steel i.e., CSC Steel and Apex Healthcare go up and down completely randomly.
Pair Corralation between CSC Steel and Apex Healthcare
Assuming the 90 days trading horizon CSC Steel Holdings is expected to generate 1.6 times more return on investment than Apex Healthcare. However, CSC Steel is 1.6 times more volatile than Apex Healthcare Bhd. It trades about -0.07 of its potential returns per unit of risk. Apex Healthcare Bhd is currently generating about -0.24 per unit of risk. If you would invest 119.00 in CSC Steel Holdings on August 31, 2024 and sell it today you would lose (2.00) from holding CSC Steel Holdings or give up 1.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CSC Steel Holdings vs. Apex Healthcare Bhd
Performance |
| Timeline |
| CSC Steel Holdings |
| Apex Healthcare Bhd |
CSC Steel and Apex Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CSC Steel and Apex Healthcare
The main advantage of trading using opposite CSC Steel and Apex Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSC Steel position performs unexpectedly, Apex Healthcare 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 Apex Healthcare will offset losses from the drop in Apex Healthcare's long position.| CSC Steel vs. PMB Technology Bhd | CSC Steel vs. Pantech Group Holdings | CSC Steel vs. Coraza Integrated Technology | CSC Steel vs. Choo Bee Metal |
| Apex Healthcare vs. Digistar Bhd | Apex Healthcare vs. Minetech Resources Bhd | Apex Healthcare vs. Swift Haulage Bhd | Apex Healthcare vs. Bina Darulaman 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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