Correlation Between YTL Hospitality and CSC Steel
Can any of the company-specific risk be diversified away by investing in both YTL Hospitality and CSC Steel 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 YTL Hospitality and CSC Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YTL Hospitality REIT and CSC Steel Holdings, you can compare the effects of market volatilities on YTL Hospitality and CSC Steel 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 YTL Hospitality with a short position of CSC Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of YTL Hospitality and CSC Steel.
Diversification Opportunities for YTL Hospitality and CSC Steel
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between YTL and CSC is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding YTL Hospitality REIT and CSC Steel Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSC Steel Holdings and YTL Hospitality 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 YTL Hospitality REIT are associated (or correlated) with CSC Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSC Steel Holdings has no effect on the direction of YTL Hospitality i.e., YTL Hospitality and CSC Steel go up and down completely randomly.
Pair Corralation between YTL Hospitality and CSC Steel
Assuming the 90 days trading horizon YTL Hospitality REIT is expected to under-perform the CSC Steel. But the stock apears to be less risky and, when comparing its historical volatility, YTL Hospitality REIT is 1.51 times less risky than CSC Steel. The stock trades about -0.05 of its potential returns per unit of risk. The CSC Steel Holdings is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 119.00 in CSC Steel Holdings on August 26, 2024 and sell it today you would earn a total of 0.00 from holding CSC Steel Holdings or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
YTL Hospitality REIT vs. CSC Steel Holdings
Performance |
| Timeline |
| YTL Hospitality REIT |
| CSC Steel Holdings |
YTL Hospitality and CSC Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YTL Hospitality and CSC Steel
The main advantage of trading using opposite YTL Hospitality and CSC Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YTL Hospitality position performs unexpectedly, CSC Steel 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 CSC Steel will offset losses from the drop in CSC Steel's long position.| YTL Hospitality vs. Digistar Bhd | YTL Hospitality vs. Minetech Resources Bhd | YTL Hospitality vs. OpenSys M Bhd | YTL Hospitality vs. Insas 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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