Correlation Between TAS Offshore and Shangri La
Can any of the company-specific risk be diversified away by investing in both TAS Offshore and Shangri La 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 TAS Offshore and Shangri La into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TAS Offshore Bhd and Shangri La Hotels, you can compare the effects of market volatilities on TAS Offshore and Shangri La 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 TAS Offshore with a short position of Shangri La. Check out your portfolio center. Please also check ongoing floating volatility patterns of TAS Offshore and Shangri La.
Diversification Opportunities for TAS Offshore and Shangri La
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between TAS and Shangri is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding TAS Offshore Bhd and Shangri La Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shangri La Hotels and TAS Offshore 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 TAS Offshore Bhd are associated (or correlated) with Shangri La. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shangri La Hotels has no effect on the direction of TAS Offshore i.e., TAS Offshore and Shangri La go up and down completely randomly.
Pair Corralation between TAS Offshore and Shangri La
Assuming the 90 days trading horizon TAS Offshore Bhd is expected to under-perform the Shangri La. In addition to that, TAS Offshore is 2.05 times more volatile than Shangri La Hotels. It trades about -0.2 of its total potential returns per unit of risk. Shangri La Hotels is currently generating about -0.01 per unit of volatility. If you would invest 202.00 in Shangri La Hotels on August 30, 2024 and sell it today you would lose (1.00) from holding Shangri La Hotels or give up 0.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
TAS Offshore Bhd vs. Shangri La Hotels
Performance |
| Timeline |
| TAS Offshore Bhd |
| Shangri La Hotels |
TAS Offshore and Shangri La Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TAS Offshore and Shangri La
The main advantage of trading using opposite TAS Offshore and Shangri La positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TAS Offshore position performs unexpectedly, Shangri La 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 Shangri La will offset losses from the drop in Shangri La's long position.| TAS Offshore vs. Press Metal Bhd | TAS Offshore vs. Eonmetall Group Bhd | TAS Offshore vs. Uchi Technologies Bhd | TAS Offshore vs. Sapura Industrial Bhd |
| Shangri La vs. Petronas Chemicals Group | Shangri La vs. Mercury Industries Bhd | Shangri La vs. Diversified Gateway Solutions | Shangri La vs. Aeon Credit Service |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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