Correlation Between Kossan Rubber and Minetech Resources
Can any of the company-specific risk be diversified away by investing in both Kossan Rubber and Minetech Resources 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 Kossan Rubber and Minetech Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kossan Rubber Industries and Minetech Resources Bhd, you can compare the effects of market volatilities on Kossan Rubber and Minetech Resources 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 Kossan Rubber with a short position of Minetech Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kossan Rubber and Minetech Resources.
Diversification Opportunities for Kossan Rubber and Minetech Resources
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kossan and Minetech is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Kossan Rubber Industries and Minetech Resources Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Minetech Resources Bhd and Kossan Rubber 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 Kossan Rubber Industries are associated (or correlated) with Minetech Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Minetech Resources Bhd has no effect on the direction of Kossan Rubber i.e., Kossan Rubber and Minetech Resources go up and down completely randomly.
Pair Corralation between Kossan Rubber and Minetech Resources
Assuming the 90 days trading horizon Kossan Rubber Industries is expected to generate 0.65 times more return on investment than Minetech Resources. However, Kossan Rubber Industries is 1.55 times less risky than Minetech Resources. It trades about -0.19 of its potential returns per unit of risk. Minetech Resources Bhd is currently generating about -0.24 per unit of risk. If you would invest 221.00 in Kossan Rubber Industries on November 28, 2024 and sell it today you would lose (36.00) from holding Kossan Rubber Industries or give up 16.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kossan Rubber Industries vs. Minetech Resources Bhd
Performance |
| Timeline |
| Kossan Rubber Industries |
| Minetech Resources Bhd |
Kossan Rubber and Minetech Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kossan Rubber and Minetech Resources
The main advantage of trading using opposite Kossan Rubber and Minetech Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kossan Rubber position performs unexpectedly, Minetech Resources 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 Minetech Resources will offset losses from the drop in Minetech Resources' long position.| Kossan Rubber vs. Ho Hup Construction | Kossan Rubber vs. Farm Price Holdings | Kossan Rubber vs. Petronas Chemicals Group | Kossan Rubber vs. Sports Toto Berhad |
| Minetech Resources vs. EA Technique M | Minetech Resources vs. Saudee Group Bhd | Minetech Resources vs. Digistar Bhd | Minetech Resources vs. AirAsia X 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Stocks Directory Find actively traded stocks across global markets |