Correlation Between Malaysia Steel and Eonmetall Group
Can any of the company-specific risk be diversified away by investing in both Malaysia Steel and Eonmetall Group 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 Eonmetall Group 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 Eonmetall Group Bhd, you can compare the effects of market volatilities on Malaysia Steel and Eonmetall Group 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 Eonmetall Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Malaysia Steel and Eonmetall Group.
Diversification Opportunities for Malaysia Steel and Eonmetall Group
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Malaysia and Eonmetall is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Malaysia Steel Works and Eonmetall Group Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eonmetall Group Bhd 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 Eonmetall Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eonmetall Group Bhd has no effect on the direction of Malaysia Steel i.e., Malaysia Steel and Eonmetall Group go up and down completely randomly.
Pair Corralation between Malaysia Steel and Eonmetall Group
Assuming the 90 days trading horizon Malaysia Steel Works is expected to under-perform the Eonmetall Group. But the stock apears to be less risky and, when comparing its historical volatility, Malaysia Steel Works is 2.28 times less risky than Eonmetall Group. The stock trades about -0.15 of its potential returns per unit of risk. The Eonmetall Group Bhd is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 30.00 in Eonmetall Group Bhd on November 4, 2024 and sell it today you would lose (2.00) from holding Eonmetall Group Bhd or give up 6.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Malaysia Steel Works vs. Eonmetall Group Bhd
Performance |
| Timeline |
| Malaysia Steel Works |
| Eonmetall Group Bhd |
Malaysia Steel and Eonmetall Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Malaysia Steel and Eonmetall Group
The main advantage of trading using opposite Malaysia Steel and Eonmetall Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Malaysia Steel position performs unexpectedly, Eonmetall Group 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 Eonmetall Group will offset losses from the drop in Eonmetall Group's long position.| Malaysia Steel vs. Eonmetall Group Bhd | Malaysia Steel vs. CPE Technology Berhad | Malaysia Steel vs. ECM Libra Financial | Malaysia Steel vs. Public Bank Bhd |
| Eonmetall Group vs. Pantech Group Holdings | Eonmetall Group vs. Binasat Communications Bhd | Eonmetall Group vs. Cengild Medical Berhad | Eonmetall Group 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 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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