Correlation Between Hong Leong and K One
Can any of the company-specific risk be diversified away by investing in both Hong Leong and K One 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 Hong Leong and K One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hong Leong Bank and K One Technology Bhd, you can compare the effects of market volatilities on Hong Leong and K One 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 Hong Leong with a short position of K One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hong Leong and K One.
Diversification Opportunities for Hong Leong and K One
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Hong and 0111 is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Hong Leong Bank and K One Technology Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on K One Technology and Hong Leong 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 Hong Leong Bank are associated (or correlated) with K One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of K One Technology has no effect on the direction of Hong Leong i.e., Hong Leong and K One go up and down completely randomly.
Pair Corralation between Hong Leong and K One
Assuming the 90 days trading horizon Hong Leong is expected to generate 4.13 times less return on investment than K One. But when comparing it to its historical volatility, Hong Leong Bank is 7.14 times less risky than K One. It trades about 0.04 of its potential returns per unit of risk. K One Technology Bhd is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 16.00 in K One Technology Bhd on September 3, 2024 and sell it today you would earn a total of 0.00 from holding K One Technology Bhd or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hong Leong Bank vs. K One Technology Bhd
Performance |
| Timeline |
| Hong Leong Bank |
| K One Technology |
Hong Leong and K One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hong Leong and K One
The main advantage of trading using opposite Hong Leong and K One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hong Leong position performs unexpectedly, K One 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 K One will offset losses from the drop in K One's long position.| Hong Leong vs. SFP Tech Holdings | Hong Leong vs. Malayan Banking Bhd | Hong Leong vs. Aurelius Technologies Bhd | Hong Leong vs. Alliance Financial Group |
| K One vs. Uchi Technologies Bhd | K One vs. Minetech Resources Bhd | K One vs. Swift Haulage Bhd | K One vs. Insas 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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