Correlation Between Ho Hup and CSC Steel
Can any of the company-specific risk be diversified away by investing in both Ho Hup 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 Ho Hup and CSC Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ho Hup Construction and CSC Steel Holdings, you can compare the effects of market volatilities on Ho Hup 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 Ho Hup with a short position of CSC Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ho Hup and CSC Steel.
Diversification Opportunities for Ho Hup and CSC Steel
Very good diversification
The 3 months correlation between 5169 and CSC is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Ho Hup Construction 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 Ho Hup 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 Ho Hup Construction 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 Ho Hup i.e., Ho Hup and CSC Steel go up and down completely randomly.
Pair Corralation between Ho Hup and CSC Steel
Assuming the 90 days trading horizon Ho Hup Construction is expected to generate 5.95 times more return on investment than CSC Steel. However, Ho Hup is 5.95 times more volatile than CSC Steel Holdings. It trades about -0.02 of its potential returns per unit of risk. CSC Steel Holdings is currently generating about -0.1 per unit of risk. If you would invest 17.00 in Ho Hup Construction on September 12, 2024 and sell it today you would lose (1.00) from holding Ho Hup Construction or give up 5.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ho Hup Construction vs. CSC Steel Holdings
Performance |
| Timeline |
| Ho Hup Construction |
| CSC Steel Holdings |
Ho Hup and CSC Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ho Hup and CSC Steel
The main advantage of trading using opposite Ho Hup and CSC Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ho Hup 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.| Ho Hup vs. Sunway Construction Group | Ho Hup vs. PESTECH International Bhd | Ho Hup vs. Central Industrial Corp | Ho Hup vs. Mercury Industries Bhd |
| CSC Steel vs. Globetronics Tech Bhd | CSC Steel vs. Ho Hup Construction | CSC Steel vs. JF Technology BHD | CSC Steel vs. MI Technovation 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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