Correlation Between Choo Bee and Aeon Credit
Can any of the company-specific risk be diversified away by investing in both Choo Bee and Aeon Credit 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 Choo Bee and Aeon Credit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Choo Bee Metal and Aeon Credit Service, you can compare the effects of market volatilities on Choo Bee and Aeon Credit 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 Choo Bee with a short position of Aeon Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Choo Bee and Aeon Credit.
Diversification Opportunities for Choo Bee and Aeon Credit
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Choo and Aeon is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Choo Bee Metal and Aeon Credit Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aeon Credit Service and Choo Bee 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 Choo Bee Metal are associated (or correlated) with Aeon Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aeon Credit Service has no effect on the direction of Choo Bee i.e., Choo Bee and Aeon Credit go up and down completely randomly.
Pair Corralation between Choo Bee and Aeon Credit
Assuming the 90 days trading horizon Choo Bee Metal is expected to under-perform the Aeon Credit. In addition to that, Choo Bee is 1.71 times more volatile than Aeon Credit Service. It trades about -0.01 of its total potential returns per unit of risk. Aeon Credit Service is currently generating about 0.03 per unit of volatility. If you would invest 598.00 in Aeon Credit Service on August 24, 2024 and sell it today you would earn a total of 82.00 from holding Aeon Credit Service or generate 13.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Choo Bee Metal vs. Aeon Credit Service
Performance |
| Timeline |
| Choo Bee Metal |
| Aeon Credit Service |
Choo Bee and Aeon Credit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Choo Bee and Aeon Credit
The main advantage of trading using opposite Choo Bee and Aeon Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Choo Bee position performs unexpectedly, Aeon Credit 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 Aeon Credit will offset losses from the drop in Aeon Credit's long position.| Choo Bee vs. Press Metal Bhd | Choo Bee vs. PMB Technology Bhd | Choo Bee vs. Pantech Group Holdings | Choo Bee vs. CSC Steel Holdings |
| Aeon Credit vs. Oriental Food Industries | Aeon Credit vs. Hong Leong Bank | Aeon Credit vs. Alliance Financial Group | Aeon Credit vs. Kawan Food 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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