Correlation Between Ho Hup and Choo Bee
Can any of the company-specific risk be diversified away by investing in both Ho Hup and Choo Bee 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 Choo Bee 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 Choo Bee Metal, you can compare the effects of market volatilities on Ho Hup and Choo Bee 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 Choo Bee. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ho Hup and Choo Bee.
Diversification Opportunities for Ho Hup and Choo Bee
Excellent diversification
The 3 months correlation between 5169 and Choo is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Ho Hup Construction and Choo Bee Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Choo Bee Metal 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 Choo Bee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Choo Bee Metal has no effect on the direction of Ho Hup i.e., Ho Hup and Choo Bee go up and down completely randomly.
Pair Corralation between Ho Hup and Choo Bee
Assuming the 90 days trading horizon Ho Hup Construction is expected to generate 2.78 times more return on investment than Choo Bee. However, Ho Hup is 2.78 times more volatile than Choo Bee Metal. It trades about 0.07 of its potential returns per unit of risk. Choo Bee Metal is currently generating about -0.33 per unit of risk. If you would invest 17.00 in Ho Hup Construction on September 2, 2024 and sell it today you would earn a total of 1.00 from holding Ho Hup Construction or generate 5.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ho Hup Construction vs. Choo Bee Metal
Performance |
| Timeline |
| Ho Hup Construction |
| Choo Bee Metal |
Ho Hup and Choo Bee Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ho Hup and Choo Bee
The main advantage of trading using opposite Ho Hup and Choo Bee positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ho Hup position performs unexpectedly, Choo Bee 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 Choo Bee will offset losses from the drop in Choo Bee's long position.| Ho Hup vs. British American Tobacco | Ho Hup vs. Shangri La Hotels | Ho Hup vs. Nova Wellness Group | Ho Hup vs. Tex Cycle Technology |
| Choo Bee vs. Pantech Group Holdings | Choo Bee vs. Coraza Integrated Technology | Choo Bee vs. Eonmetall Group 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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