Correlation Between KPJ Healthcare and YX Precious
Can any of the company-specific risk be diversified away by investing in both KPJ Healthcare and YX Precious 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 KPJ Healthcare and YX Precious into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KPJ Healthcare Bhd and YX Precious Metals, you can compare the effects of market volatilities on KPJ Healthcare and YX Precious 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 KPJ Healthcare with a short position of YX Precious. Check out your portfolio center. Please also check ongoing floating volatility patterns of KPJ Healthcare and YX Precious.
Diversification Opportunities for KPJ Healthcare and YX Precious
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between KPJ and 0250 is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding KPJ Healthcare Bhd and YX Precious Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YX Precious Metals and KPJ Healthcare 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 KPJ Healthcare Bhd are associated (or correlated) with YX Precious. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YX Precious Metals has no effect on the direction of KPJ Healthcare i.e., KPJ Healthcare and YX Precious go up and down completely randomly.
Pair Corralation between KPJ Healthcare and YX Precious
Assuming the 90 days trading horizon KPJ Healthcare Bhd is expected to generate 0.9 times more return on investment than YX Precious. However, KPJ Healthcare Bhd is 1.11 times less risky than YX Precious. It trades about 0.09 of its potential returns per unit of risk. YX Precious Metals is currently generating about -0.05 per unit of risk. If you would invest 191.00 in KPJ Healthcare Bhd on November 2, 2024 and sell it today you would earn a total of 32.00 from holding KPJ Healthcare Bhd or generate 16.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KPJ Healthcare Bhd vs. YX Precious Metals
Performance |
| Timeline |
| KPJ Healthcare Bhd |
| YX Precious Metals |
KPJ Healthcare and YX Precious Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KPJ Healthcare and YX Precious
The main advantage of trading using opposite KPJ Healthcare and YX Precious positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KPJ Healthcare position performs unexpectedly, YX Precious 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 YX Precious will offset losses from the drop in YX Precious' long position.| KPJ Healthcare vs. Leader Steel Holdings | KPJ Healthcare vs. MClean Technologies Bhd | KPJ Healthcare vs. Sunway Construction Group | KPJ Healthcare vs. Oriental Food Industries |
| YX Precious vs. Supercomnet Technologies Bhd | YX Precious vs. Sunzen Biotech Bhd | YX Precious vs. Berjaya Food Bhd | YX Precious vs. Cosmos Technology International |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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