Correlation Between Star Media and RCE Capital
Can any of the company-specific risk be diversified away by investing in both Star Media and RCE Capital 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 Star Media and RCE Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Star Media Group and RCE Capital Berhad, you can compare the effects of market volatilities on Star Media and RCE Capital 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 Star Media with a short position of RCE Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Star Media and RCE Capital.
Diversification Opportunities for Star Media and RCE Capital
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Star and RCE is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Star Media Group and RCE Capital Berhad in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RCE Capital Berhad and Star Media 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 Star Media Group are associated (or correlated) with RCE Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RCE Capital Berhad has no effect on the direction of Star Media i.e., Star Media and RCE Capital go up and down completely randomly.
Pair Corralation between Star Media and RCE Capital
Assuming the 90 days trading horizon Star Media Group is expected to generate 1.03 times more return on investment than RCE Capital. However, Star Media is 1.03 times more volatile than RCE Capital Berhad. It trades about 0.01 of its potential returns per unit of risk. RCE Capital Berhad is currently generating about -0.13 per unit of risk. If you would invest 40.00 in Star Media Group on November 3, 2024 and sell it today you would earn a total of 0.00 from holding Star Media Group or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Star Media Group vs. RCE Capital Berhad
Performance |
| Timeline |
| Star Media Group |
| RCE Capital Berhad |
Star Media and RCE Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Star Media and RCE Capital
The main advantage of trading using opposite Star Media and RCE Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Star Media position performs unexpectedly, RCE Capital 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 RCE Capital will offset losses from the drop in RCE Capital's long position.| Star Media vs. Sunway Construction Group | Star Media vs. Ho Hup Construction | Star Media vs. Cloudpoint Technology Berhad | Star Media vs. Resintech Bhd |
| RCE Capital vs. Apex Healthcare Bhd | RCE Capital vs. DC HEALTHCARE HOLDINGS | RCE Capital vs. FARM FRESH BERHAD | RCE Capital vs. CSC Steel Holdings |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |