Correlation Between PGF Capital and Tex Cycle
Can any of the company-specific risk be diversified away by investing in both PGF Capital and Tex Cycle 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 PGF Capital and Tex Cycle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PGF Capital Bhd and Tex Cycle Technology, you can compare the effects of market volatilities on PGF Capital and Tex Cycle 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 PGF Capital with a short position of Tex Cycle. Check out your portfolio center. Please also check ongoing floating volatility patterns of PGF Capital and Tex Cycle.
Diversification Opportunities for PGF Capital and Tex Cycle
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between PGF and Tex is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding PGF Capital Bhd and Tex Cycle Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tex Cycle Technology and PGF Capital 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 PGF Capital Bhd are associated (or correlated) with Tex Cycle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tex Cycle Technology has no effect on the direction of PGF Capital i.e., PGF Capital and Tex Cycle go up and down completely randomly.
Pair Corralation between PGF Capital and Tex Cycle
Assuming the 90 days trading horizon PGF Capital Bhd is expected to generate 1.5 times more return on investment than Tex Cycle. However, PGF Capital is 1.5 times more volatile than Tex Cycle Technology. It trades about 0.09 of its potential returns per unit of risk. Tex Cycle Technology is currently generating about -0.33 per unit of risk. If you would invest 214.00 in PGF Capital Bhd on October 9, 2024 and sell it today you would earn a total of 4.00 from holding PGF Capital Bhd or generate 1.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
PGF Capital Bhd vs. Tex Cycle Technology
Performance |
| Timeline |
| PGF Capital Bhd |
| Tex Cycle Technology |
PGF Capital and Tex Cycle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PGF Capital and Tex Cycle
The main advantage of trading using opposite PGF Capital and Tex Cycle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PGF Capital position performs unexpectedly, Tex Cycle 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 Tex Cycle will offset losses from the drop in Tex Cycle's long position.| PGF Capital vs. Steel Hawk Berhad | PGF Capital vs. Uchi Technologies Bhd | PGF Capital vs. Press Metal Bhd | PGF Capital vs. CSC Steel Holdings |
| Tex Cycle vs. YX Precious Metals | Tex Cycle vs. KPJ Healthcare Bhd | Tex Cycle vs. DC HEALTHCARE HOLDINGS | Tex Cycle vs. Southern Steel 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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