Correlation Between Computer Forms and Hartalega Holdings
Can any of the company-specific risk be diversified away by investing in both Computer Forms and Hartalega Holdings 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 Computer Forms and Hartalega Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Computer Forms Bhd and Hartalega Holdings Bhd, you can compare the effects of market volatilities on Computer Forms and Hartalega Holdings 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 Computer Forms with a short position of Hartalega Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Computer Forms and Hartalega Holdings.
Diversification Opportunities for Computer Forms and Hartalega Holdings
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Computer and Hartalega is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Computer Forms Bhd and Hartalega Holdings Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartalega Holdings Bhd and Computer Forms 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 Computer Forms Bhd are associated (or correlated) with Hartalega Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartalega Holdings Bhd has no effect on the direction of Computer Forms i.e., Computer Forms and Hartalega Holdings go up and down completely randomly.
Pair Corralation between Computer Forms and Hartalega Holdings
Assuming the 90 days trading horizon Computer Forms Bhd is expected to under-perform the Hartalega Holdings. In addition to that, Computer Forms is 1.61 times more volatile than Hartalega Holdings Bhd. It trades about -0.08 of its total potential returns per unit of risk. Hartalega Holdings Bhd is currently generating about 0.07 per unit of volatility. If you would invest 153.00 in Hartalega Holdings Bhd on September 5, 2024 and sell it today you would earn a total of 204.00 from holding Hartalega Holdings Bhd or generate 133.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Computer Forms Bhd vs. Hartalega Holdings Bhd
Performance |
| Timeline |
| Computer Forms Bhd |
| Hartalega Holdings Bhd |
Computer Forms and Hartalega Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Computer Forms and Hartalega Holdings
The main advantage of trading using opposite Computer Forms and Hartalega Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Computer Forms position performs unexpectedly, Hartalega Holdings 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 Hartalega Holdings will offset losses from the drop in Hartalega Holdings' long position.| Computer Forms vs. Minetech Resources Bhd | Computer Forms vs. Swift Haulage Bhd | Computer Forms vs. Insas Bhd | Computer Forms vs. Bina Darulaman Bhd |
| Hartalega Holdings vs. Southern Steel Bhd | Hartalega Holdings vs. Public Bank Bhd | Hartalega Holdings vs. Computer Forms Bhd | Hartalega Holdings vs. CPE Technology 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 Stocks Directory module to find actively traded stocks across global markets.
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