Correlation Between Duopharma Biotech and Public Bank
Can any of the company-specific risk be diversified away by investing in both Duopharma Biotech and Public Bank 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 Duopharma Biotech and Public Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Duopharma Biotech Bhd and Public Bank Bhd, you can compare the effects of market volatilities on Duopharma Biotech and Public Bank 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 Duopharma Biotech with a short position of Public Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Duopharma Biotech and Public Bank.
Diversification Opportunities for Duopharma Biotech and Public Bank
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Duopharma and Public is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Duopharma Biotech Bhd and Public Bank Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Public Bank Bhd and Duopharma Biotech 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 Duopharma Biotech Bhd are associated (or correlated) with Public Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Public Bank Bhd has no effect on the direction of Duopharma Biotech i.e., Duopharma Biotech and Public Bank go up and down completely randomly.
Pair Corralation between Duopharma Biotech and Public Bank
Assuming the 90 days trading horizon Duopharma Biotech is expected to generate 5.04 times less return on investment than Public Bank. In addition to that, Duopharma Biotech is 1.61 times more volatile than Public Bank Bhd. It trades about 0.01 of its total potential returns per unit of risk. Public Bank Bhd is currently generating about 0.06 per unit of volatility. If you would invest 372.00 in Public Bank Bhd on September 12, 2024 and sell it today you would earn a total of 80.00 from holding Public Bank Bhd or generate 21.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Duopharma Biotech Bhd vs. Public Bank Bhd
Performance |
| Timeline |
| Duopharma Biotech Bhd |
| Public Bank Bhd |
Duopharma Biotech and Public Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Duopharma Biotech and Public Bank
The main advantage of trading using opposite Duopharma Biotech and Public Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Duopharma Biotech position performs unexpectedly, Public Bank 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 Public Bank will offset losses from the drop in Public Bank's long position.| Duopharma Biotech vs. Farm Price Holdings | Duopharma Biotech vs. JF Technology BHD | Duopharma Biotech vs. Cloudpoint Technology Berhad | Duopharma Biotech vs. Computer Forms 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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