Correlation Between Tenaga Nasional and ATA IMS
Can any of the company-specific risk be diversified away by investing in both Tenaga Nasional and ATA IMS 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 ATA IMS 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 ATA IMS Bhd, you can compare the effects of market volatilities on Tenaga Nasional and ATA IMS 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 ATA IMS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tenaga Nasional and ATA IMS.
Diversification Opportunities for Tenaga Nasional and ATA IMS
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tenaga and ATA is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Tenaga Nasional Bhd and ATA IMS Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATA IMS 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 ATA IMS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATA IMS Bhd has no effect on the direction of Tenaga Nasional i.e., Tenaga Nasional and ATA IMS go up and down completely randomly.
Pair Corralation between Tenaga Nasional and ATA IMS
Assuming the 90 days trading horizon Tenaga Nasional Bhd is expected to under-perform the ATA IMS. But the stock apears to be less risky and, when comparing its historical volatility, Tenaga Nasional Bhd is 2.55 times less risky than ATA IMS. The stock trades about -0.14 of its potential returns per unit of risk. The ATA IMS Bhd is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 28.00 in ATA IMS Bhd on September 4, 2024 and sell it today you would earn a total of 0.00 from holding ATA IMS Bhd or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Tenaga Nasional Bhd vs. ATA IMS Bhd
Performance |
| Timeline |
| Tenaga Nasional Bhd |
| ATA IMS Bhd |
Tenaga Nasional and ATA IMS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tenaga Nasional and ATA IMS
The main advantage of trading using opposite Tenaga Nasional and ATA IMS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tenaga Nasional position performs unexpectedly, ATA IMS 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 ATA IMS will offset losses from the drop in ATA IMS's long position.| Tenaga Nasional vs. Radiant Globaltech Bhd | Tenaga Nasional vs. Sunzen Biotech Bhd | Tenaga Nasional vs. JF Technology BHD | Tenaga Nasional vs. Uchi Technologies Bhd |
| ATA IMS vs. Malayan Banking Bhd | ATA IMS vs. Public Bank Bhd | ATA IMS vs. Petronas Chemicals Group | ATA IMS 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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