Correlation Between Tenaga Nasional and OpenSys M
Can any of the company-specific risk be diversified away by investing in both Tenaga Nasional and OpenSys M 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 Tenaga Nasional and OpenSys M into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tenaga Nasional Bhd and OpenSys M Bhd, you can compare the effects of market volatilities on Tenaga Nasional and OpenSys M 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 Tenaga Nasional with a short position of OpenSys M. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tenaga Nasional and OpenSys M.
Diversification Opportunities for Tenaga Nasional and OpenSys M
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tenaga and OpenSys is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Tenaga Nasional Bhd and OpenSys M Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OpenSys M Bhd and Tenaga Nasional 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 Tenaga Nasional Bhd are associated (or correlated) with OpenSys M. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OpenSys M Bhd has no effect on the direction of Tenaga Nasional i.e., Tenaga Nasional and OpenSys M go up and down completely randomly.
Pair Corralation between Tenaga Nasional and OpenSys M
Assuming the 90 days trading horizon Tenaga Nasional Bhd is expected to generate 0.62 times more return on investment than OpenSys M. However, Tenaga Nasional Bhd is 1.62 times less risky than OpenSys M. It trades about 0.14 of its potential returns per unit of risk. OpenSys M Bhd is currently generating about 0.02 per unit of risk. If you would invest 958.00 in Tenaga Nasional Bhd on August 26, 2024 and sell it today you would earn a total of 442.00 from holding Tenaga Nasional Bhd or generate 46.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tenaga Nasional Bhd vs. OpenSys M Bhd
Performance |
| Timeline |
| Tenaga Nasional Bhd |
| OpenSys M Bhd |
Tenaga Nasional and OpenSys M Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tenaga Nasional and OpenSys M
The main advantage of trading using opposite Tenaga Nasional and OpenSys M positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tenaga Nasional position performs unexpectedly, OpenSys M 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 OpenSys M will offset losses from the drop in OpenSys M's long position.| Tenaga Nasional vs. HeiTech Padu Bhd | Tenaga Nasional vs. Lysaght Galvanized Steel | Tenaga Nasional vs. Digistar Bhd | Tenaga Nasional vs. Swift Haulage Bhd |
| OpenSys M vs. Malayan Banking Bhd | OpenSys M vs. Public Bank Bhd | OpenSys M vs. Petronas Chemicals Group | OpenSys M vs. Tenaga Nasional 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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