Correlation Between Duopharma Biotech and Berjaya Food
Can any of the company-specific risk be diversified away by investing in both Duopharma Biotech and Berjaya Food 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 Berjaya Food 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 Berjaya Food Bhd, you can compare the effects of market volatilities on Duopharma Biotech and Berjaya Food 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 Berjaya Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Duopharma Biotech and Berjaya Food.
Diversification Opportunities for Duopharma Biotech and Berjaya Food
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Duopharma and Berjaya is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Duopharma Biotech Bhd and Berjaya Food Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berjaya Food 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 Berjaya Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Berjaya Food Bhd has no effect on the direction of Duopharma Biotech i.e., Duopharma Biotech and Berjaya Food go up and down completely randomly.
Pair Corralation between Duopharma Biotech and Berjaya Food
Assuming the 90 days trading horizon Duopharma Biotech Bhd is expected to generate 0.22 times more return on investment than Berjaya Food. However, Duopharma Biotech Bhd is 4.6 times less risky than Berjaya Food. It trades about -0.19 of its potential returns per unit of risk. Berjaya Food Bhd is currently generating about -0.06 per unit of risk. If you would invest 131.00 in Duopharma Biotech Bhd on August 27, 2024 and sell it today you would lose (6.00) from holding Duopharma Biotech Bhd or give up 4.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Duopharma Biotech Bhd vs. Berjaya Food Bhd
Performance |
| Timeline |
| Duopharma Biotech Bhd |
| Berjaya Food Bhd |
Duopharma Biotech and Berjaya Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Duopharma Biotech and Berjaya Food
The main advantage of trading using opposite Duopharma Biotech and Berjaya Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Duopharma Biotech position performs unexpectedly, Berjaya Food 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 Berjaya Food will offset losses from the drop in Berjaya Food's long position.| Duopharma Biotech vs. Digistar Bhd | Duopharma Biotech vs. Minetech Resources Bhd | Duopharma Biotech vs. OpenSys M Bhd | Duopharma Biotech vs. Insas 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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