Correlation Between Malaysia Steel and Choo Bee
Can any of the company-specific risk be diversified away by investing in both Malaysia Steel and Choo Bee 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 Malaysia Steel and Choo Bee into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Malaysia Steel Works and Choo Bee Metal, you can compare the effects of market volatilities on Malaysia Steel and Choo Bee 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 Malaysia Steel with a short position of Choo Bee. Check out your portfolio center. Please also check ongoing floating volatility patterns of Malaysia Steel and Choo Bee.
Diversification Opportunities for Malaysia Steel and Choo Bee
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Malaysia and Choo is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Malaysia Steel Works and Choo Bee Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Choo Bee Metal and Malaysia 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 Malaysia Steel Works are associated (or correlated) with Choo Bee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Choo Bee Metal has no effect on the direction of Malaysia Steel i.e., Malaysia Steel and Choo Bee go up and down completely randomly.
Pair Corralation between Malaysia Steel and Choo Bee
Assuming the 90 days trading horizon Malaysia Steel Works is expected to under-perform the Choo Bee. In addition to that, Malaysia Steel is 1.27 times more volatile than Choo Bee Metal. It trades about -0.15 of its total potential returns per unit of risk. Choo Bee Metal is currently generating about 0.01 per unit of volatility. If you would invest 70.00 in Choo Bee Metal on November 3, 2024 and sell it today you would earn a total of 0.00 from holding Choo Bee Metal 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 |
Malaysia Steel Works vs. Choo Bee Metal
Performance |
| Timeline |
| Malaysia Steel Works |
| Choo Bee Metal |
Malaysia Steel and Choo Bee Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Malaysia Steel and Choo Bee
The main advantage of trading using opposite Malaysia Steel and Choo Bee positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Malaysia Steel position performs unexpectedly, Choo Bee 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 Choo Bee will offset losses from the drop in Choo Bee's long position.| Malaysia Steel vs. Oriental Food Industries | Malaysia Steel vs. Petronas Chemicals Group | Malaysia Steel vs. Kawan Food Bhd | Malaysia Steel vs. Globetronics Tech Bhd |
| Choo Bee vs. Dufu Tech Corp | Choo Bee vs. Computer Forms Bhd | Choo Bee vs. Rubberex M | Choo Bee vs. SFP Tech 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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