Correlation Between Kawan Food and Public Bank
Can any of the company-specific risk be diversified away by investing in both Kawan Food 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 Kawan Food and Public Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kawan Food Bhd and Public Bank Bhd, you can compare the effects of market volatilities on Kawan Food 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 Kawan Food with a short position of Public Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kawan Food and Public Bank.
Diversification Opportunities for Kawan Food and Public Bank
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kawan and Public is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Kawan Food 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 Kawan Food 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 Kawan Food 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 Kawan Food i.e., Kawan Food and Public Bank go up and down completely randomly.
Pair Corralation between Kawan Food and Public Bank
Assuming the 90 days trading horizon Kawan Food is expected to generate 43.55 times less return on investment than Public Bank. In addition to that, Kawan Food is 1.09 times more volatile than Public Bank Bhd. It trades about 0.0 of its total potential returns per unit of risk. Public Bank Bhd is currently generating about 0.21 per unit of volatility. If you would invest 444.00 in Public Bank Bhd on September 13, 2024 and sell it today you would earn a total of 17.00 from holding Public Bank Bhd or generate 3.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kawan Food Bhd vs. Public Bank Bhd
Performance |
| Timeline |
| Kawan Food Bhd |
| Public Bank Bhd |
Kawan Food and Public Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kawan Food and Public Bank
The main advantage of trading using opposite Kawan Food and Public Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kawan Food 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.| Kawan Food vs. MClean Technologies Bhd | Kawan Food vs. Awanbiru Technology Bhd | Kawan Food vs. Computer Forms Bhd | Kawan Food vs. SFP Tech 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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