Correlation Between Swift Haulage and Hengyuan Refining
Can any of the company-specific risk be diversified away by investing in both Swift Haulage and Hengyuan Refining 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 Swift Haulage and Hengyuan Refining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swift Haulage Bhd and Hengyuan Refining, you can compare the effects of market volatilities on Swift Haulage and Hengyuan Refining 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 Swift Haulage with a short position of Hengyuan Refining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swift Haulage and Hengyuan Refining.
Diversification Opportunities for Swift Haulage and Hengyuan Refining
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Swift and Hengyuan is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Swift Haulage Bhd and Hengyuan Refining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hengyuan Refining and Swift Haulage 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 Swift Haulage Bhd are associated (or correlated) with Hengyuan Refining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hengyuan Refining has no effect on the direction of Swift Haulage i.e., Swift Haulage and Hengyuan Refining go up and down completely randomly.
Pair Corralation between Swift Haulage and Hengyuan Refining
Assuming the 90 days trading horizon Swift Haulage Bhd is expected to generate 0.59 times more return on investment than Hengyuan Refining. However, Swift Haulage Bhd is 1.7 times less risky than Hengyuan Refining. It trades about -0.05 of its potential returns per unit of risk. Hengyuan Refining is currently generating about -0.04 per unit of risk. If you would invest 54.00 in Swift Haulage Bhd on August 27, 2024 and sell it today you would lose (9.00) from holding Swift Haulage Bhd or give up 16.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Swift Haulage Bhd vs. Hengyuan Refining
Performance |
| Timeline |
| Swift Haulage Bhd |
| Hengyuan Refining |
Swift Haulage and Hengyuan Refining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Swift Haulage and Hengyuan Refining
The main advantage of trading using opposite Swift Haulage and Hengyuan Refining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swift Haulage position performs unexpectedly, Hengyuan Refining 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 Hengyuan Refining will offset losses from the drop in Hengyuan Refining's long position.| Swift Haulage vs. Malayan Banking Bhd | Swift Haulage vs. Public Bank Bhd | Swift Haulage vs. Petronas Chemicals Group | Swift Haulage vs. Tenaga Nasional Bhd |
| Hengyuan Refining vs. Ho Hup Construction | Hengyuan Refining vs. Coraza Integrated Technology | Hengyuan Refining vs. K One Technology Bhd | Hengyuan Refining vs. Greatech Technology 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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