Correlation Between CB Industrial and Sungei Bagan
Can any of the company-specific risk be diversified away by investing in both CB Industrial and Sungei Bagan 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 CB Industrial and Sungei Bagan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CB Industrial Product and Sungei Bagan Rubber, you can compare the effects of market volatilities on CB Industrial and Sungei Bagan 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 CB Industrial with a short position of Sungei Bagan. Check out your portfolio center. Please also check ongoing floating volatility patterns of CB Industrial and Sungei Bagan.
Diversification Opportunities for CB Industrial and Sungei Bagan
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 7076 and Sungei is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding CB Industrial Product and Sungei Bagan Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sungei Bagan Rubber and CB Industrial 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 CB Industrial Product are associated (or correlated) with Sungei Bagan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sungei Bagan Rubber has no effect on the direction of CB Industrial i.e., CB Industrial and Sungei Bagan go up and down completely randomly.
Pair Corralation between CB Industrial and Sungei Bagan
Assuming the 90 days trading horizon CB Industrial Product is expected to generate 1.37 times more return on investment than Sungei Bagan. However, CB Industrial is 1.37 times more volatile than Sungei Bagan Rubber. It trades about 0.01 of its potential returns per unit of risk. Sungei Bagan Rubber is currently generating about -0.31 per unit of risk. If you would invest 131.00 in CB Industrial Product on September 1, 2024 and sell it today you would earn a total of 0.00 from holding CB Industrial Product or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CB Industrial Product vs. Sungei Bagan Rubber
Performance |
| Timeline |
| CB Industrial Product |
| Sungei Bagan Rubber |
CB Industrial and Sungei Bagan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CB Industrial and Sungei Bagan
The main advantage of trading using opposite CB Industrial and Sungei Bagan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CB Industrial position performs unexpectedly, Sungei Bagan 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 Sungei Bagan will offset losses from the drop in Sungei Bagan's long position.| CB Industrial vs. CPE Technology Berhad | CB Industrial vs. Central Industrial Corp | CB Industrial vs. Lotte Chemical Titan | CB Industrial vs. Petronas Chemicals Group |
| Sungei Bagan vs. Eonmetall Group Bhd | Sungei Bagan vs. Sapura Industrial Bhd | Sungei Bagan vs. Mycron Steel Bhd | Sungei Bagan vs. Daya Materials 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |