Correlation Between EA Technique and Sapura Industrial
Can any of the company-specific risk be diversified away by investing in both EA Technique and Sapura Industrial 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 EA Technique and Sapura Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EA Technique M and Sapura Industrial Bhd, you can compare the effects of market volatilities on EA Technique and Sapura Industrial 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 EA Technique with a short position of Sapura Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of EA Technique and Sapura Industrial.
Diversification Opportunities for EA Technique and Sapura Industrial
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between 5259 and Sapura is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding EA Technique M and Sapura Industrial Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sapura Industrial Bhd and EA Technique 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 EA Technique M are associated (or correlated) with Sapura Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sapura Industrial Bhd has no effect on the direction of EA Technique i.e., EA Technique and Sapura Industrial go up and down completely randomly.
Pair Corralation between EA Technique and Sapura Industrial
Assuming the 90 days trading horizon EA Technique is expected to generate 22.85 times less return on investment than Sapura Industrial. But when comparing it to its historical volatility, EA Technique M is 1.41 times less risky than Sapura Industrial. It trades about 0.01 of its potential returns per unit of risk. Sapura Industrial Bhd is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 82.00 in Sapura Industrial Bhd on September 1, 2024 and sell it today you would earn a total of 2.00 from holding Sapura Industrial Bhd or generate 2.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EA Technique M vs. Sapura Industrial Bhd
Performance |
| Timeline |
| EA Technique M |
| Sapura Industrial Bhd |
EA Technique and Sapura Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EA Technique and Sapura Industrial
The main advantage of trading using opposite EA Technique and Sapura Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EA Technique position performs unexpectedly, Sapura Industrial 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 Sapura Industrial will offset losses from the drop in Sapura Industrial's long position.| EA Technique vs. Kobay Tech Bhd | EA Technique vs. CPE Technology Berhad | EA Technique vs. Star Media Group | EA Technique vs. Resintech Bhd |
| Sapura Industrial vs. Digistar Bhd | Sapura Industrial vs. Minetech Resources Bhd | Sapura Industrial vs. Swift Haulage Bhd | Sapura Industrial vs. Bina Darulaman 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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