Correlation Between Berjaya Food and Cengild Medical
Can any of the company-specific risk be diversified away by investing in both Berjaya Food and Cengild Medical 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 Berjaya Food and Cengild Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Berjaya Food Bhd and Cengild Medical Berhad, you can compare the effects of market volatilities on Berjaya Food and Cengild Medical 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 Berjaya Food with a short position of Cengild Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Berjaya Food and Cengild Medical.
Diversification Opportunities for Berjaya Food and Cengild Medical
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Berjaya and Cengild is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Berjaya Food Bhd and Cengild Medical Berhad in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cengild Medical Berhad and Berjaya Food 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 Berjaya Food Bhd are associated (or correlated) with Cengild Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cengild Medical Berhad has no effect on the direction of Berjaya Food i.e., Berjaya Food and Cengild Medical go up and down completely randomly.
Pair Corralation between Berjaya Food and Cengild Medical
Assuming the 90 days trading horizon Berjaya Food Bhd is expected to under-perform the Cengild Medical. In addition to that, Berjaya Food is 1.88 times more volatile than Cengild Medical Berhad. It trades about -0.04 of its total potential returns per unit of risk. Cengild Medical Berhad is currently generating about 0.02 per unit of volatility. If you would invest 27.00 in Cengild Medical Berhad on November 3, 2024 and sell it today you would earn a total of 1.00 from holding Cengild Medical Berhad or generate 3.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Berjaya Food Bhd vs. Cengild Medical Berhad
Performance |
| Timeline |
| Berjaya Food Bhd |
| Cengild Medical Berhad |
Berjaya Food and Cengild Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Berjaya Food and Cengild Medical
The main advantage of trading using opposite Berjaya Food and Cengild Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Berjaya Food position performs unexpectedly, Cengild Medical 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 Cengild Medical will offset losses from the drop in Cengild Medical's long position.| Berjaya Food vs. Steel Hawk Berhad | Berjaya Food vs. Petronas Chemicals Group | Berjaya Food vs. Southern Steel Bhd | Berjaya Food vs. Senheng New Retail |
| Cengild Medical vs. ES Ceramics Technology | Cengild Medical vs. Globetronics Tech Bhd | Cengild Medical vs. MI Technovation Bhd | Cengild Medical vs. Sports Toto Berhad |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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