Correlation Between Al Aqar and Sungei Bagan
Can any of the company-specific risk be diversified away by investing in both Al Aqar and Sungei Bagan 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 Al Aqar and Sungei Bagan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Al Aqar Healthcare and Sungei Bagan Rubber, you can compare the effects of market volatilities on Al Aqar and Sungei Bagan 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 Al Aqar with a short position of Sungei Bagan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Al Aqar and Sungei Bagan.
Diversification Opportunities for Al Aqar and Sungei Bagan
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 5116 and Sungei is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Al Aqar Healthcare and Sungei Bagan Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sungei Bagan Rubber and Al Aqar 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 Al Aqar Healthcare are associated (or correlated) with Sungei Bagan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sungei Bagan Rubber has no effect on the direction of Al Aqar i.e., Al Aqar and Sungei Bagan go up and down completely randomly.
Pair Corralation between Al Aqar and Sungei Bagan
Assuming the 90 days trading horizon Al Aqar Healthcare is expected to generate 1.01 times more return on investment than Sungei Bagan. However, Al Aqar is 1.01 times more volatile than Sungei Bagan Rubber. It trades about 0.0 of its potential returns per unit of risk. Sungei Bagan Rubber is currently generating about -0.03 per unit of risk. If you would invest 130.00 in Al Aqar Healthcare on November 2, 2024 and sell it today you would earn a total of 0.00 from holding Al Aqar Healthcare or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Al Aqar Healthcare vs. Sungei Bagan Rubber
Performance |
| Timeline |
| Al Aqar Healthcare |
| Sungei Bagan Rubber |
Al Aqar and Sungei Bagan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Al Aqar and Sungei Bagan
The main advantage of trading using opposite Al Aqar and Sungei Bagan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Al Aqar position performs unexpectedly, Sungei Bagan 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 Sungei Bagan will offset losses from the drop in Sungei Bagan's long position.| Al Aqar vs. Awanbiru Technology Bhd | Al Aqar vs. Public Bank Bhd | Al Aqar vs. Malayan Banking Bhd | Al Aqar vs. Bank Islam Malaysia |
| Sungei Bagan vs. Rubberex M | Sungei Bagan vs. Public Packages Holdings | Sungei Bagan vs. Central Industrial Corp | Sungei Bagan vs. Berjaya Food 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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