Correlation Between Apex Healthcare and Sungei Bagan
Can any of the company-specific risk be diversified away by investing in both Apex Healthcare 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 Apex Healthcare and Sungei Bagan 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 Sungei Bagan Rubber, you can compare the effects of market volatilities on Apex Healthcare 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 Apex Healthcare with a short position of Sungei Bagan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apex Healthcare and Sungei Bagan.
Diversification Opportunities for Apex Healthcare and Sungei Bagan
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Apex and Sungei is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Apex Healthcare Bhd 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 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 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 Apex Healthcare i.e., Apex Healthcare and Sungei Bagan go up and down completely randomly.
Pair Corralation between Apex Healthcare and Sungei Bagan
Assuming the 90 days trading horizon Apex Healthcare Bhd is expected to under-perform the Sungei Bagan. But the stock apears to be less risky and, when comparing its historical volatility, Apex Healthcare Bhd is 1.0 times less risky than Sungei Bagan. The stock trades about -0.08 of its potential returns per unit of risk. The Sungei Bagan Rubber is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 591.00 in Sungei Bagan Rubber on November 2, 2024 and sell it today you would lose (17.00) from holding Sungei Bagan Rubber or give up 2.88% 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. Sungei Bagan Rubber
Performance |
| Timeline |
| Apex Healthcare Bhd |
| Sungei Bagan Rubber |
Apex Healthcare and Sungei Bagan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apex Healthcare and Sungei Bagan
The main advantage of trading using opposite Apex Healthcare and Sungei Bagan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apex Healthcare 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.| Apex Healthcare vs. Bank Islam Malaysia | Apex Healthcare vs. Aeon Credit Service | Apex Healthcare vs. Greatech Technology Bhd | Apex Healthcare vs. Computer Forms Bhd |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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