Correlation Between Bina Darulaman and MI Technovation
Can any of the company-specific risk be diversified away by investing in both Bina Darulaman and MI Technovation 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 Bina Darulaman and MI Technovation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bina Darulaman Bhd and MI Technovation Bhd, you can compare the effects of market volatilities on Bina Darulaman and MI Technovation 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 Bina Darulaman with a short position of MI Technovation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bina Darulaman and MI Technovation.
Diversification Opportunities for Bina Darulaman and MI Technovation
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bina and 5286 is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Bina Darulaman Bhd and MI Technovation Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MI Technovation Bhd and Bina Darulaman 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 Bina Darulaman Bhd are associated (or correlated) with MI Technovation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MI Technovation Bhd has no effect on the direction of Bina Darulaman i.e., Bina Darulaman and MI Technovation go up and down completely randomly.
Pair Corralation between Bina Darulaman and MI Technovation
Assuming the 90 days trading horizon Bina Darulaman is expected to generate 32.33 times less return on investment than MI Technovation. But when comparing it to its historical volatility, Bina Darulaman Bhd is 1.39 times less risky than MI Technovation. It trades about 0.01 of its potential returns per unit of risk. MI Technovation Bhd is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 181.00 in MI Technovation Bhd on September 5, 2024 and sell it today you would earn a total of 30.00 from holding MI Technovation Bhd or generate 16.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Bina Darulaman Bhd vs. MI Technovation Bhd
Performance |
| Timeline |
| Bina Darulaman Bhd |
| MI Technovation Bhd |
Bina Darulaman and MI Technovation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bina Darulaman and MI Technovation
The main advantage of trading using opposite Bina Darulaman and MI Technovation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bina Darulaman position performs unexpectedly, MI Technovation 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 MI Technovation will offset losses from the drop in MI Technovation's long position.| Bina Darulaman vs. Malayan Banking Bhd | Bina Darulaman vs. Public Bank Bhd | Bina Darulaman vs. Petronas Chemicals Group | Bina Darulaman vs. Tenaga Nasional Bhd |
| MI Technovation vs. Minetech Resources Bhd | MI Technovation vs. Swift Haulage Bhd | MI Technovation vs. Insas Bhd | MI Technovation vs. Bina Darulaman 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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