Correlation Between Uwc Bhd and Lotus KFM
Can any of the company-specific risk be diversified away by investing in both Uwc Bhd and Lotus KFM 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 Uwc Bhd and Lotus KFM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uwc Bhd and Lotus KFM Bhd, you can compare the effects of market volatilities on Uwc Bhd and Lotus KFM 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 Uwc Bhd with a short position of Lotus KFM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uwc Bhd and Lotus KFM.
Diversification Opportunities for Uwc Bhd and Lotus KFM
Very good diversification
The 3 months correlation between Uwc and Lotus is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Uwc Bhd and Lotus KFM Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lotus KFM Bhd and Uwc Bhd 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 Uwc Bhd are associated (or correlated) with Lotus KFM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lotus KFM Bhd has no effect on the direction of Uwc Bhd i.e., Uwc Bhd and Lotus KFM go up and down completely randomly.
Pair Corralation between Uwc Bhd and Lotus KFM
Assuming the 90 days trading horizon Uwc Bhd is expected to under-perform the Lotus KFM. But the stock apears to be less risky and, when comparing its historical volatility, Uwc Bhd is 1.44 times less risky than Lotus KFM. The stock trades about -0.19 of its potential returns per unit of risk. The Lotus KFM Bhd is currently generating about -0.11 of returns per unit of risk over similar time horizon. If you would invest 14.00 in Lotus KFM Bhd on November 28, 2024 and sell it today you would lose (1.00) from holding Lotus KFM Bhd or give up 7.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Uwc Bhd vs. Lotus KFM Bhd
Performance |
| Timeline |
| Uwc Bhd |
| Lotus KFM Bhd |
Uwc Bhd and Lotus KFM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Uwc Bhd and Lotus KFM
The main advantage of trading using opposite Uwc Bhd and Lotus KFM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uwc Bhd position performs unexpectedly, Lotus KFM 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 Lotus KFM will offset losses from the drop in Lotus KFM's long position.| Uwc Bhd vs. Datasonic Group Bhd | Uwc Bhd vs. RHB Bank Bhd | Uwc Bhd vs. Eonmetall Group Bhd | Uwc Bhd vs. TAS Offshore Bhd |
| Lotus KFM vs. Kluang Rubber | Lotus KFM vs. Press Metal Bhd | Lotus KFM vs. Petronas Chemicals Group | Lotus KFM vs. Choo Bee Metal |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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