Correlation Between KPJ Healthcare and CIMB Group
Can any of the company-specific risk be diversified away by investing in both KPJ Healthcare and CIMB Group 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 CIMB Group 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 CIMB Group Holdings, you can compare the effects of market volatilities on KPJ Healthcare and CIMB Group 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 CIMB Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of KPJ Healthcare and CIMB Group.
Diversification Opportunities for KPJ Healthcare and CIMB Group
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between KPJ and CIMB is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding KPJ Healthcare Bhd and CIMB Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIMB Group Holdings 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 CIMB Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIMB Group Holdings has no effect on the direction of KPJ Healthcare i.e., KPJ Healthcare and CIMB Group go up and down completely randomly.
Pair Corralation between KPJ Healthcare and CIMB Group
Assuming the 90 days trading horizon KPJ Healthcare Bhd is expected to generate 1.71 times more return on investment than CIMB Group. However, KPJ Healthcare is 1.71 times more volatile than CIMB Group Holdings. It trades about 0.71 of its potential returns per unit of risk. CIMB Group Holdings is currently generating about 0.21 per unit of risk. If you would invest 209.00 in KPJ Healthcare Bhd on August 31, 2024 and sell it today you would earn a total of 41.00 from holding KPJ Healthcare Bhd or generate 19.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
KPJ Healthcare Bhd vs. CIMB Group Holdings
Performance |
| Timeline |
| KPJ Healthcare Bhd |
| CIMB Group Holdings |
KPJ Healthcare and CIMB Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KPJ Healthcare and CIMB Group
The main advantage of trading using opposite KPJ Healthcare and CIMB Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KPJ Healthcare position performs unexpectedly, CIMB Group 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 CIMB Group will offset losses from the drop in CIMB Group's long position.| KPJ Healthcare vs. Alliance Financial Group | KPJ Healthcare vs. Eversafe Rubber Bhd | KPJ Healthcare vs. Public Bank Bhd | KPJ Healthcare vs. Kossan Rubber Industries |
| CIMB Group vs. KPJ Healthcare Bhd | CIMB Group vs. IHH Healthcare Bhd | CIMB Group vs. Apex Healthcare Bhd | CIMB Group vs. TAS Offshore 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Commodity Directory Find actively traded commodities issued by global exchanges |