Correlation Between PGF Capital and Steel Hawk
Can any of the company-specific risk be diversified away by investing in both PGF Capital and Steel Hawk 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 Steel Hawk 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 Steel Hawk Berhad, you can compare the effects of market volatilities on PGF Capital and Steel Hawk 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 Steel Hawk. Check out your portfolio center. Please also check ongoing floating volatility patterns of PGF Capital and Steel Hawk.
Diversification Opportunities for PGF Capital and Steel Hawk
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PGF and Steel is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding PGF Capital Bhd and Steel Hawk Berhad in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Steel Hawk Berhad 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 Steel Hawk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Steel Hawk Berhad has no effect on the direction of PGF Capital i.e., PGF Capital and Steel Hawk go up and down completely randomly.
Pair Corralation between PGF Capital and Steel Hawk
Assuming the 90 days trading horizon PGF Capital is expected to generate 1.92 times less return on investment than Steel Hawk. But when comparing it to its historical volatility, PGF Capital Bhd is 1.38 times less risky than Steel Hawk. It trades about 0.01 of its potential returns per unit of risk. Steel Hawk Berhad is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 45.00 in Steel Hawk Berhad on October 25, 2024 and sell it today you would earn a total of 0.00 from holding Steel Hawk Berhad or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
PGF Capital Bhd vs. Steel Hawk Berhad
Performance |
| Timeline |
| PGF Capital Bhd |
| Steel Hawk Berhad |
PGF Capital and Steel Hawk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PGF Capital and Steel Hawk
The main advantage of trading using opposite PGF Capital and Steel Hawk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PGF Capital position performs unexpectedly, Steel Hawk 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 Steel Hawk will offset losses from the drop in Steel Hawk's long position.| PGF Capital vs. Tex Cycle Technology | PGF Capital vs. YX Precious Metals | PGF Capital vs. Bank Islam Malaysia | PGF Capital vs. PMB Technology Bhd |
| Steel Hawk vs. Al Aqar Healthcare | Steel Hawk vs. Ho Hup Construction | Steel Hawk vs. Cosmos Technology International | Steel Hawk vs. Computer Forms 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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