Correlation Between Aurelius Technologies and Kluang Rubber
Can any of the company-specific risk be diversified away by investing in both Aurelius Technologies and Kluang 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 Aurelius Technologies and Kluang Rubber into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aurelius Technologies Bhd and Kluang Rubber, you can compare the effects of market volatilities on Aurelius Technologies and Kluang 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 Aurelius Technologies with a short position of Kluang Rubber. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurelius Technologies and Kluang Rubber.
Diversification Opportunities for Aurelius Technologies and Kluang Rubber
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Aurelius and Kluang is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Aurelius Technologies Bhd and Kluang Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kluang Rubber and Aurelius Technologies 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 Aurelius Technologies Bhd are associated (or correlated) with Kluang Rubber. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kluang Rubber has no effect on the direction of Aurelius Technologies i.e., Aurelius Technologies and Kluang Rubber go up and down completely randomly.
Pair Corralation between Aurelius Technologies and Kluang Rubber
Assuming the 90 days trading horizon Aurelius Technologies is expected to generate 1.61 times less return on investment than Kluang Rubber. But when comparing it to its historical volatility, Aurelius Technologies Bhd is 1.02 times less risky than Kluang Rubber. It trades about 0.05 of its potential returns per unit of risk. Kluang Rubber is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 368.00 in Kluang Rubber on September 2, 2024 and sell it today you would earn a total of 216.00 from holding Kluang Rubber or generate 58.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 86.61% |
| Values | Daily Returns |
Aurelius Technologies Bhd vs. Kluang Rubber
Performance |
| Timeline |
| Aurelius Technologies Bhd |
| Kluang Rubber |
Aurelius Technologies and Kluang Rubber Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurelius Technologies and Kluang Rubber
The main advantage of trading using opposite Aurelius Technologies and Kluang Rubber positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurelius Technologies position performs unexpectedly, Kluang 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 Kluang Rubber will offset losses from the drop in Kluang Rubber's long position.| Aurelius Technologies vs. TAS Offshore Bhd | Aurelius Technologies vs. CPE Technology Berhad | Aurelius Technologies vs. DC HEALTHCARE HOLDINGS | Aurelius Technologies vs. Computer Forms Bhd |
| Kluang Rubber vs. British American Tobacco | Kluang Rubber vs. FARM FRESH BERHAD | Kluang Rubber vs. Apollo Food Holdings |
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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