Correlation Between Berjaya Food and Mr D
Can any of the company-specific risk be diversified away by investing in both Berjaya Food and Mr D 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 Mr D 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 Mr D I, you can compare the effects of market volatilities on Berjaya Food and Mr D 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 Mr D. Check out your portfolio center. Please also check ongoing floating volatility patterns of Berjaya Food and Mr D.
Diversification Opportunities for Berjaya Food and Mr D
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Berjaya and 5296 is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Berjaya Food Bhd and Mr D I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mr D I 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 Mr D. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mr D I has no effect on the direction of Berjaya Food i.e., Berjaya Food and Mr D go up and down completely randomly.
Pair Corralation between Berjaya Food and Mr D
Assuming the 90 days trading horizon Berjaya Food Bhd is expected to under-perform the Mr D. In addition to that, Berjaya Food is 2.15 times more volatile than Mr D I. It trades about -0.02 of its total potential returns per unit of risk. Mr D I is currently generating about 0.01 per unit of volatility. If you would invest 181.00 in Mr D I on September 16, 2024 and sell it today you would earn a total of 0.00 from holding Mr D I or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Berjaya Food Bhd vs. Mr D I
Performance |
| Timeline |
| Berjaya Food Bhd |
| Mr D I |
Berjaya Food and Mr D Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Berjaya Food and Mr D
The main advantage of trading using opposite Berjaya Food and Mr D positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Berjaya Food position performs unexpectedly, Mr D 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 Mr D will offset losses from the drop in Mr D's long position.| Berjaya Food vs. Leader Steel Holdings | Berjaya Food vs. Choo Bee Metal | Berjaya Food vs. Ho Hup Construction | Berjaya Food vs. FARM FRESH BERHAD |
| Mr D vs. Sports Toto Berhad | Mr D vs. Petronas Chemicals Group | Mr D vs. Binasat Communications Bhd | Mr D vs. Al Aqar Healthcare |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| CEOs Directory Screen CEOs from public companies around the world |