Correlation Between Sapura Industrial and JAKS Resources
Can any of the company-specific risk be diversified away by investing in both Sapura Industrial and JAKS 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 Sapura Industrial and JAKS Resources 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 JAKS Resources Bhd, you can compare the effects of market volatilities on Sapura Industrial and JAKS 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 Sapura Industrial with a short position of JAKS Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sapura Industrial and JAKS Resources.
Diversification Opportunities for Sapura Industrial and JAKS Resources
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sapura and JAKS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Sapura Industrial Bhd and JAKS Resources Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JAKS Resources 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 JAKS Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JAKS Resources Bhd has no effect on the direction of Sapura Industrial i.e., Sapura Industrial and JAKS Resources go up and down completely randomly.
Pair Corralation between Sapura Industrial and JAKS Resources
Assuming the 90 days trading horizon Sapura Industrial Bhd is expected to generate 1.07 times more return on investment than JAKS Resources. However, Sapura Industrial is 1.07 times more volatile than JAKS Resources Bhd. It trades about 0.03 of its potential returns per unit of risk. JAKS Resources Bhd is currently generating about -0.01 per unit of risk. If you would invest 77.00 in Sapura Industrial Bhd on October 7, 2024 and sell it today you would earn a total of 11.00 from holding Sapura Industrial Bhd or generate 14.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Sapura Industrial Bhd vs. JAKS Resources Bhd
Performance |
| Timeline |
| Sapura Industrial Bhd |
| JAKS Resources Bhd |
Sapura Industrial and JAKS Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sapura Industrial and JAKS Resources
The main advantage of trading using opposite Sapura Industrial and JAKS Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sapura Industrial position performs unexpectedly, JAKS 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 JAKS Resources will offset losses from the drop in JAKS Resources' long position.| Sapura Industrial vs. Eversafe Rubber Bhd | Sapura Industrial vs. Minetech Resources Bhd | Sapura Industrial vs. Tambun Indah Land | Sapura Industrial vs. OpenSys M Bhd |
| JAKS Resources vs. SFP Tech Holdings | JAKS Resources vs. Tex Cycle Technology | JAKS Resources vs. IHH Healthcare Bhd | JAKS Resources vs. Aurelius 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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