Correlation Between Swift Haulage and Shangri La
Can any of the company-specific risk be diversified away by investing in both Swift Haulage and Shangri La 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 Shangri La 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 Shangri La Hotels, you can compare the effects of market volatilities on Swift Haulage and Shangri La 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 Shangri La. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swift Haulage and Shangri La.
Diversification Opportunities for Swift Haulage and Shangri La
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Swift and Shangri is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Swift Haulage Bhd and Shangri La Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shangri La Hotels 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 Shangri La. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shangri La Hotels has no effect on the direction of Swift Haulage i.e., Swift Haulage and Shangri La go up and down completely randomly.
Pair Corralation between Swift Haulage and Shangri La
Assuming the 90 days trading horizon Swift Haulage Bhd is expected to under-perform the Shangri La. In addition to that, Swift Haulage is 2.65 times more volatile than Shangri La Hotels. It trades about -0.13 of its total potential returns per unit of risk. Shangri La Hotels is currently generating about -0.11 per unit of volatility. If you would invest 203.00 in Shangri La Hotels on August 24, 2024 and sell it today you would lose (4.00) from holding Shangri La Hotels or give up 1.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Swift Haulage Bhd vs. Shangri La Hotels
Performance |
| Timeline |
| Swift Haulage Bhd |
| Shangri La Hotels |
Swift Haulage and Shangri La Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Swift Haulage and Shangri La
The main advantage of trading using opposite Swift Haulage and Shangri La positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swift Haulage position performs unexpectedly, Shangri La 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 Shangri La will offset losses from the drop in Shangri La's long position.| Swift Haulage vs. EA Technique M | Swift Haulage vs. SFP Tech Holdings | Swift Haulage vs. Carlsberg Brewery Malaysia | Swift Haulage vs. Southern Steel Bhd |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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