Correlation Between Impiana Hotels and Malayan Banking
Can any of the company-specific risk be diversified away by investing in both Impiana Hotels and Malayan Banking 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 Impiana Hotels and Malayan Banking into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Impiana Hotels Bhd and Malayan Banking Bhd, you can compare the effects of market volatilities on Impiana Hotels and Malayan Banking 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 Impiana Hotels with a short position of Malayan Banking. Check out your portfolio center. Please also check ongoing floating volatility patterns of Impiana Hotels and Malayan Banking.
Diversification Opportunities for Impiana Hotels and Malayan Banking
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Impiana and Malayan is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Impiana Hotels Bhd and Malayan Banking Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Malayan Banking Bhd and Impiana Hotels 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 Impiana Hotels Bhd are associated (or correlated) with Malayan Banking. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Malayan Banking Bhd has no effect on the direction of Impiana Hotels i.e., Impiana Hotels and Malayan Banking go up and down completely randomly.
Pair Corralation between Impiana Hotels and Malayan Banking
Assuming the 90 days trading horizon Impiana Hotels Bhd is expected to generate 8.72 times more return on investment than Malayan Banking. However, Impiana Hotels is 8.72 times more volatile than Malayan Banking Bhd. It trades about 0.06 of its potential returns per unit of risk. Malayan Banking Bhd is currently generating about 0.1 per unit of risk. If you would invest 9.50 in Impiana Hotels Bhd on September 14, 2024 and sell it today you would earn a total of 11.50 from holding Impiana Hotels Bhd or generate 121.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Impiana Hotels Bhd vs. Malayan Banking Bhd
Performance |
| Timeline |
| Impiana Hotels Bhd |
| Malayan Banking Bhd |
Impiana Hotels and Malayan Banking Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Impiana Hotels and Malayan Banking
The main advantage of trading using opposite Impiana Hotels and Malayan Banking positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Impiana Hotels position performs unexpectedly, Malayan Banking 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 Malayan Banking will offset losses from the drop in Malayan Banking's long position.| Impiana Hotels vs. Sports Toto Berhad | Impiana Hotels vs. Al Aqar Healthcare | Impiana Hotels vs. PMB Technology Bhd | Impiana Hotels vs. Digistar Bhd |
| Malayan Banking vs. Carlsberg Brewery Malaysia | Malayan Banking vs. Impiana Hotels Bhd | Malayan Banking vs. Hong Leong Bank | Malayan Banking vs. Sports Toto Berhad |
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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