Correlation Between Petronas Chemicals and Sports Toto
Can any of the company-specific risk be diversified away by investing in both Petronas Chemicals and Sports Toto 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 Petronas Chemicals and Sports Toto into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Petronas Chemicals Group and Sports Toto Berhad, you can compare the effects of market volatilities on Petronas Chemicals and Sports Toto 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 Petronas Chemicals with a short position of Sports Toto. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petronas Chemicals and Sports Toto.
Diversification Opportunities for Petronas Chemicals and Sports Toto
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Petronas and Sports is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Petronas Chemicals Group and Sports Toto Berhad in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sports Toto Berhad and Petronas Chemicals 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 Petronas Chemicals Group are associated (or correlated) with Sports Toto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sports Toto Berhad has no effect on the direction of Petronas Chemicals i.e., Petronas Chemicals and Sports Toto go up and down completely randomly.
Pair Corralation between Petronas Chemicals and Sports Toto
Assuming the 90 days trading horizon Petronas Chemicals Group is expected to under-perform the Sports Toto. In addition to that, Petronas Chemicals is 1.64 times more volatile than Sports Toto Berhad. It trades about -0.25 of its total potential returns per unit of risk. Sports Toto Berhad is currently generating about -0.13 per unit of volatility. If you would invest 152.00 in Sports Toto Berhad on August 31, 2024 and sell it today you would lose (7.00) from holding Sports Toto Berhad or give up 4.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Petronas Chemicals Group vs. Sports Toto Berhad
Performance |
| Timeline |
| Petronas Chemicals |
| Sports Toto Berhad |
Petronas Chemicals and Sports Toto Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Petronas Chemicals and Sports Toto
The main advantage of trading using opposite Petronas Chemicals and Sports Toto positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petronas Chemicals position performs unexpectedly, Sports Toto 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 Sports Toto will offset losses from the drop in Sports Toto's long position.| Petronas Chemicals vs. Choo Bee Metal | Petronas Chemicals vs. Melewar Industrial Group | Petronas Chemicals vs. Al Aqar Healthcare | Petronas Chemicals vs. K One Technology Bhd |
| Sports Toto vs. Carlsberg Brewery Malaysia | Sports Toto vs. Alliance Financial Group | Sports Toto vs. Press Metal Bhd | Sports Toto vs. Impiana Hotels 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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