Correlation Between Duopharma Biotech and Hartalega Holdings
Can any of the company-specific risk be diversified away by investing in both Duopharma Biotech and Hartalega Holdings 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 Hartalega Holdings 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 Hartalega Holdings Bhd, you can compare the effects of market volatilities on Duopharma Biotech and Hartalega Holdings 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 Hartalega Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Duopharma Biotech and Hartalega Holdings.
Diversification Opportunities for Duopharma Biotech and Hartalega Holdings
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Duopharma and Hartalega is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Duopharma Biotech Bhd and Hartalega Holdings Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartalega Holdings 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 Hartalega Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartalega Holdings Bhd has no effect on the direction of Duopharma Biotech i.e., Duopharma Biotech and Hartalega Holdings go up and down completely randomly.
Pair Corralation between Duopharma Biotech and Hartalega Holdings
Assuming the 90 days trading horizon Duopharma Biotech is expected to generate 7.83 times less return on investment than Hartalega Holdings. But when comparing it to its historical volatility, Duopharma Biotech Bhd is 1.59 times less risky than Hartalega Holdings. It trades about 0.07 of its potential returns per unit of risk. Hartalega Holdings Bhd is currently generating about 0.35 of returns per unit of risk over similar time horizon. If you would invest 331.00 in Hartalega Holdings Bhd on September 13, 2024 and sell it today you would earn a total of 47.00 from holding Hartalega Holdings Bhd or generate 14.2% 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. Hartalega Holdings Bhd
Performance |
| Timeline |
| Duopharma Biotech Bhd |
| Hartalega Holdings Bhd |
Duopharma Biotech and Hartalega Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Duopharma Biotech and Hartalega Holdings
The main advantage of trading using opposite Duopharma Biotech and Hartalega Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Duopharma Biotech position performs unexpectedly, Hartalega Holdings 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 Hartalega Holdings will offset losses from the drop in Hartalega Holdings' long position.| Duopharma Biotech vs. Al Aqar Healthcare | Duopharma Biotech vs. Lyc Healthcare Bhd | Duopharma Biotech vs. Senheng New Retail | Duopharma Biotech vs. Central Industrial Corp |
| Hartalega Holdings vs. JF Technology BHD | Hartalega Holdings vs. Computer Forms Bhd | Hartalega Holdings vs. Diversified Gateway Solutions | Hartalega Holdings vs. Apollo Food Holdings |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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