Correlation Between Apex Healthcare and Binasat Communications
Can any of the company-specific risk be diversified away by investing in both Apex Healthcare and Binasat Communications 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 Apex Healthcare and Binasat Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apex Healthcare Bhd and Binasat Communications Bhd, you can compare the effects of market volatilities on Apex Healthcare and Binasat Communications 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 Apex Healthcare with a short position of Binasat Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apex Healthcare and Binasat Communications.
Diversification Opportunities for Apex Healthcare and Binasat Communications
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Apex and Binasat is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Apex Healthcare Bhd and Binasat Communications Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Binasat Communications and Apex Healthcare 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 Apex Healthcare Bhd are associated (or correlated) with Binasat Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Binasat Communications has no effect on the direction of Apex Healthcare i.e., Apex Healthcare and Binasat Communications go up and down completely randomly.
Pair Corralation between Apex Healthcare and Binasat Communications
Assuming the 90 days trading horizon Apex Healthcare Bhd is expected to generate 0.38 times more return on investment than Binasat Communications. However, Apex Healthcare Bhd is 2.64 times less risky than Binasat Communications. It trades about -0.08 of its potential returns per unit of risk. Binasat Communications Bhd is currently generating about -0.1 per unit of risk. If you would invest 267.00 in Apex Healthcare Bhd on November 2, 2024 and sell it today you would lose (22.00) from holding Apex Healthcare Bhd or give up 8.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apex Healthcare Bhd vs. Binasat Communications Bhd
Performance |
| Timeline |
| Apex Healthcare Bhd |
| Binasat Communications |
Apex Healthcare and Binasat Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apex Healthcare and Binasat Communications
The main advantage of trading using opposite Apex Healthcare and Binasat Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apex Healthcare position performs unexpectedly, Binasat Communications 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 Binasat Communications will offset losses from the drop in Binasat Communications' long position.| Apex Healthcare vs. Bank Islam Malaysia | Apex Healthcare vs. Aeon Credit Service | Apex Healthcare vs. Greatech Technology Bhd | Apex Healthcare vs. Computer Forms Bhd |
| Binasat Communications vs. Choo Bee Metal | Binasat Communications vs. Homeritz Bhd | Binasat Communications vs. Sunway Construction Group | Binasat Communications vs. Eonmetall Group 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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