Correlation Between Sapura Industrial and Media Prima
Can any of the company-specific risk be diversified away by investing in both Sapura Industrial and Media Prima 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 Sapura Industrial and Media Prima into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sapura Industrial Bhd and Media Prima Bhd, you can compare the effects of market volatilities on Sapura Industrial and Media Prima 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 Sapura Industrial with a short position of Media Prima. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sapura Industrial and Media Prima.
Diversification Opportunities for Sapura Industrial and Media Prima
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sapura and Media is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Sapura Industrial Bhd and Media Prima Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Media Prima Bhd and Sapura Industrial 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 Sapura Industrial Bhd are associated (or correlated) with Media Prima. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Media Prima Bhd has no effect on the direction of Sapura Industrial i.e., Sapura Industrial and Media Prima go up and down completely randomly.
Pair Corralation between Sapura Industrial and Media Prima
Assuming the 90 days trading horizon Sapura Industrial Bhd is expected to generate 1.77 times more return on investment than Media Prima. However, Sapura Industrial is 1.77 times more volatile than Media Prima Bhd. It trades about 0.15 of its potential returns per unit of risk. Media Prima Bhd is currently generating about 0.0 per unit of risk. If you would invest 82.00 in Sapura Industrial Bhd on August 27, 2024 and sell it today you would earn a total of 3.00 from holding Sapura Industrial Bhd or generate 3.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sapura Industrial Bhd vs. Media Prima Bhd
Performance |
| Timeline |
| Sapura Industrial Bhd |
| Media Prima Bhd |
Sapura Industrial and Media Prima Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sapura Industrial and Media Prima
The main advantage of trading using opposite Sapura Industrial and Media Prima positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sapura Industrial position performs unexpectedly, Media Prima 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 Media Prima will offset losses from the drop in Media Prima's long position.| Sapura Industrial vs. Eversafe Rubber Bhd | Sapura Industrial vs. Digistar Bhd | Sapura Industrial vs. Minetech Resources Bhd | Sapura Industrial vs. OpenSys M Bhd |
| Media Prima vs. Diversified Gateway Solutions | Media Prima vs. Supercomnet Technologies Bhd | Media Prima vs. ONETECH SOLUTIONS HOLDINGS | Media Prima vs. Uchi Technologies 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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