Correlation Between CB Industrial and Kamdar Group
Can any of the company-specific risk be diversified away by investing in both CB Industrial and Kamdar 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 CB Industrial and Kamdar Group 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 Kamdar Group Bhd, you can compare the effects of market volatilities on CB Industrial and Kamdar 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 CB Industrial with a short position of Kamdar Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of CB Industrial and Kamdar Group.
Diversification Opportunities for CB Industrial and Kamdar Group
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 7076 and Kamdar is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding CB Industrial Product and Kamdar Group Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kamdar Group Bhd 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 Kamdar Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kamdar Group Bhd has no effect on the direction of CB Industrial i.e., CB Industrial and Kamdar Group go up and down completely randomly.
Pair Corralation between CB Industrial and Kamdar Group
Assuming the 90 days trading horizon CB Industrial is expected to generate 3.01 times less return on investment than Kamdar Group. But when comparing it to its historical volatility, CB Industrial Product is 3.43 times less risky than Kamdar Group. It trades about 0.05 of its potential returns per unit of risk. Kamdar Group Bhd is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 24.00 in Kamdar Group Bhd on September 12, 2024 and sell it today you would earn a total of 9.00 from holding Kamdar Group Bhd or generate 37.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.41% |
| Values | Daily Returns |
CB Industrial Product vs. Kamdar Group Bhd
Performance |
| Timeline |
| CB Industrial Product |
| Kamdar Group Bhd |
CB Industrial and Kamdar Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CB Industrial and Kamdar Group
The main advantage of trading using opposite CB Industrial and Kamdar Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CB Industrial position performs unexpectedly, Kamdar 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 Kamdar Group will offset losses from the drop in Kamdar Group's long position.| CB Industrial vs. PIE Industrial Bhd | CB Industrial vs. Kobay Tech Bhd | CB Industrial vs. JF Technology BHD | CB Industrial vs. MyTech Group Bhd |
| Kamdar Group vs. MClean Technologies Bhd | Kamdar Group vs. K One Technology Bhd | Kamdar Group vs. CB Industrial Product | Kamdar Group vs. PMB Technology 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.
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