Correlation Between Techbond Group and Kossan Rubber
Can any of the company-specific risk be diversified away by investing in both Techbond Group and Kossan Rubber 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 Techbond Group and Kossan Rubber into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Techbond Group Bhd and Kossan Rubber Industries, you can compare the effects of market volatilities on Techbond Group and Kossan Rubber 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 Techbond Group with a short position of Kossan Rubber. Check out your portfolio center. Please also check ongoing floating volatility patterns of Techbond Group and Kossan Rubber.
Diversification Opportunities for Techbond Group and Kossan Rubber
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Techbond and Kossan is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Techbond Group Bhd and Kossan Rubber Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kossan Rubber Industries and Techbond Group 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 Techbond Group Bhd are associated (or correlated) with Kossan Rubber. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kossan Rubber Industries has no effect on the direction of Techbond Group i.e., Techbond Group and Kossan Rubber go up and down completely randomly.
Pair Corralation between Techbond Group and Kossan Rubber
Assuming the 90 days trading horizon Techbond Group Bhd is expected to generate 0.68 times more return on investment than Kossan Rubber. However, Techbond Group Bhd is 1.47 times less risky than Kossan Rubber. It trades about -0.07 of its potential returns per unit of risk. Kossan Rubber Industries is currently generating about -0.28 per unit of risk. If you would invest 38.00 in Techbond Group Bhd on November 30, 2024 and sell it today you would lose (3.00) from holding Techbond Group Bhd or give up 7.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Techbond Group Bhd vs. Kossan Rubber Industries
Performance |
| Timeline |
| Techbond Group Bhd |
| Kossan Rubber Industries |
Techbond Group and Kossan Rubber Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Techbond Group and Kossan Rubber
The main advantage of trading using opposite Techbond Group and Kossan Rubber positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Techbond Group position performs unexpectedly, Kossan Rubber 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 Kossan Rubber will offset losses from the drop in Kossan Rubber's long position.| Techbond Group vs. Ho Hup Construction | Techbond Group vs. Farm Price Holdings | Techbond Group vs. RHB Bank Bhd | Techbond Group vs. Public Bank Bhd |
| Kossan Rubber vs. Sports Toto Berhad | Kossan Rubber vs. Resintech Bhd | Kossan Rubber vs. Duopharma Biotech Bhd | Kossan Rubber vs. Homeritz 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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |