Correlation Between Press Metal and Telekom Malaysia
Can any of the company-specific risk be diversified away by investing in both Press Metal and Telekom Malaysia 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 Press Metal and Telekom Malaysia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Press Metal Bhd and Telekom Malaysia Bhd, you can compare the effects of market volatilities on Press Metal and Telekom Malaysia 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 Press Metal with a short position of Telekom Malaysia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Press Metal and Telekom Malaysia.
Diversification Opportunities for Press Metal and Telekom Malaysia
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Press and Telekom is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Press Metal Bhd and Telekom Malaysia Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telekom Malaysia Bhd and Press Metal 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 Press Metal Bhd are associated (or correlated) with Telekom Malaysia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telekom Malaysia Bhd has no effect on the direction of Press Metal i.e., Press Metal and Telekom Malaysia go up and down completely randomly.
Pair Corralation between Press Metal and Telekom Malaysia
Assuming the 90 days trading horizon Press Metal Bhd is expected to generate 2.34 times more return on investment than Telekom Malaysia. However, Press Metal is 2.34 times more volatile than Telekom Malaysia Bhd. It trades about 0.31 of its potential returns per unit of risk. Telekom Malaysia Bhd is currently generating about 0.35 per unit of risk. If you would invest 440.00 in Press Metal Bhd on September 15, 2024 and sell it today you would earn a total of 65.00 from holding Press Metal Bhd or generate 14.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Press Metal Bhd vs. Telekom Malaysia Bhd
Performance |
| Timeline |
| Press Metal Bhd |
| Telekom Malaysia Bhd |
Press Metal and Telekom Malaysia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Press Metal and Telekom Malaysia
The main advantage of trading using opposite Press Metal and Telekom Malaysia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Press Metal position performs unexpectedly, Telekom Malaysia 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 Telekom Malaysia will offset losses from the drop in Telekom Malaysia's long position.| Press Metal vs. PMB Technology Bhd | Press Metal vs. Pantech Group Holdings | Press Metal vs. CSC Steel Holdings | Press Metal vs. Coraza Integrated Technology |
| Telekom Malaysia vs. Central Industrial Corp | Telekom Malaysia vs. Farm Price Holdings | Telekom Malaysia vs. Awanbiru Technology Bhd | Telekom Malaysia vs. Press Metal 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |