Correlation Between QL Resources and Al Aqar
Can any of the company-specific risk be diversified away by investing in both QL Resources and Al Aqar 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 QL Resources and Al Aqar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between QL Resources Bhd and Al Aqar Healthcare, you can compare the effects of market volatilities on QL Resources and Al Aqar 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 QL Resources with a short position of Al Aqar. Check out your portfolio center. Please also check ongoing floating volatility patterns of QL Resources and Al Aqar.
Diversification Opportunities for QL Resources and Al Aqar
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 7084 and 5116 is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding QL Resources Bhd and Al Aqar Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Al Aqar Healthcare and QL Resources 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 QL Resources Bhd are associated (or correlated) with Al Aqar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Al Aqar Healthcare has no effect on the direction of QL Resources i.e., QL Resources and Al Aqar go up and down completely randomly.
Pair Corralation between QL Resources and Al Aqar
Assuming the 90 days trading horizon QL Resources Bhd is expected to generate 0.92 times more return on investment than Al Aqar. However, QL Resources Bhd is 1.08 times less risky than Al Aqar. It trades about 0.06 of its potential returns per unit of risk. Al Aqar Healthcare is currently generating about 0.03 per unit of risk. If you would invest 387.00 in QL Resources Bhd on September 4, 2024 and sell it today you would earn a total of 102.00 from holding QL Resources Bhd or generate 26.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
QL Resources Bhd vs. Al Aqar Healthcare
Performance |
| Timeline |
| QL Resources Bhd |
| Al Aqar Healthcare |
QL Resources and Al Aqar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with QL Resources and Al Aqar
The main advantage of trading using opposite QL Resources and Al Aqar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if QL Resources position performs unexpectedly, Al Aqar 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 Al Aqar will offset losses from the drop in Al Aqar's long position.| QL Resources vs. Keck Seng Malaysia | QL Resources vs. Minetech Resources Bhd | QL Resources vs. Swift Haulage Bhd | QL Resources vs. Insas Bhd |
| Al Aqar vs. Minetech Resources Bhd | Al Aqar vs. Swift Haulage Bhd | Al Aqar vs. Insas Bhd | Al Aqar 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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