Correlation Between Sapura Energy and Apex Healthcare
Can any of the company-specific risk be diversified away by investing in both Sapura Energy and Apex Healthcare 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 Sapura Energy and Apex Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sapura Energy Bhd and Apex Healthcare Bhd, you can compare the effects of market volatilities on Sapura Energy and Apex Healthcare 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 Sapura Energy with a short position of Apex Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sapura Energy and Apex Healthcare.
Diversification Opportunities for Sapura Energy and Apex Healthcare
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sapura and Apex is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Sapura Energy Bhd and Apex Healthcare Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apex Healthcare Bhd and Sapura Energy 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 Sapura Energy Bhd are associated (or correlated) with Apex Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apex Healthcare Bhd has no effect on the direction of Sapura Energy i.e., Sapura Energy and Apex Healthcare go up and down completely randomly.
Pair Corralation between Sapura Energy and Apex Healthcare
Assuming the 90 days trading horizon Sapura Energy Bhd is expected to generate 12.01 times more return on investment than Apex Healthcare. However, Sapura Energy is 12.01 times more volatile than Apex Healthcare Bhd. It trades about 0.06 of its potential returns per unit of risk. Apex Healthcare Bhd is currently generating about -0.08 per unit of risk. If you would invest 3.50 in Sapura Energy Bhd on November 2, 2024 and sell it today you would earn a total of 0.00 from holding Sapura Energy Bhd or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sapura Energy Bhd vs. Apex Healthcare Bhd
Performance |
| Timeline |
| Sapura Energy Bhd |
| Apex Healthcare Bhd |
Sapura Energy and Apex Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sapura Energy and Apex Healthcare
The main advantage of trading using opposite Sapura Energy and Apex Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sapura Energy position performs unexpectedly, Apex Healthcare 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 Apex Healthcare will offset losses from the drop in Apex Healthcare's long position.| Sapura Energy vs. Malayan Banking Bhd | Sapura Energy vs. Public Bank Bhd | Sapura Energy vs. Petronas Chemicals Group | Sapura Energy vs. Tenaga Nasional Bhd |
| Apex Healthcare vs. Bank Islam Malaysia | Apex Healthcare vs. Aeon Credit Service | Apex Healthcare vs. Greatech Technology Bhd | Apex Healthcare vs. Computer Forms 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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