Correlation Between PMB Technology and Datasonic Group
Can any of the company-specific risk be diversified away by investing in both PMB Technology and Datasonic Group 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 PMB Technology and Datasonic Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PMB Technology Bhd and Datasonic Group Bhd, you can compare the effects of market volatilities on PMB Technology and Datasonic Group 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 PMB Technology with a short position of Datasonic Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of PMB Technology and Datasonic Group.
Diversification Opportunities for PMB Technology and Datasonic Group
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between PMB and Datasonic is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding PMB Technology Bhd and Datasonic Group Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Datasonic Group Bhd and PMB Technology 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 PMB Technology Bhd are associated (or correlated) with Datasonic Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Datasonic Group Bhd has no effect on the direction of PMB Technology i.e., PMB Technology and Datasonic Group go up and down completely randomly.
Pair Corralation between PMB Technology and Datasonic Group
Assuming the 90 days trading horizon PMB Technology Bhd is expected to under-perform the Datasonic Group. In addition to that, PMB Technology is 1.36 times more volatile than Datasonic Group Bhd. It trades about -0.07 of its total potential returns per unit of risk. Datasonic Group Bhd is currently generating about 0.01 per unit of volatility. If you would invest 41.00 in Datasonic Group Bhd on November 8, 2024 and sell it today you would lose (1.00) from holding Datasonic Group Bhd or give up 2.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PMB Technology Bhd vs. Datasonic Group Bhd
Performance |
| Timeline |
| PMB Technology Bhd |
| Datasonic Group Bhd |
PMB Technology and Datasonic Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PMB Technology and Datasonic Group
The main advantage of trading using opposite PMB Technology and Datasonic Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PMB Technology position performs unexpectedly, Datasonic Group 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 Datasonic Group will offset losses from the drop in Datasonic Group's long position.| PMB Technology vs. CPE Technology Berhad | PMB Technology vs. SSF Home Group | PMB Technology vs. Lyc Healthcare Bhd | PMB Technology vs. KPJ Healthcare Bhd |
| Datasonic Group vs. Dataprep Holdings Bhd | Datasonic Group vs. Sports Toto Berhad | Datasonic Group vs. Binasat Communications Bhd | Datasonic Group vs. Homeritz 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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