Correlation Between Press Metal and Berjaya Food
Can any of the company-specific risk be diversified away by investing in both Press Metal and Berjaya Food 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 Berjaya Food 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 Berjaya Food Bhd, you can compare the effects of market volatilities on Press Metal and Berjaya Food 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 Berjaya Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Press Metal and Berjaya Food.
Diversification Opportunities for Press Metal and Berjaya Food
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Press and Berjaya is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Press Metal Bhd and Berjaya Food Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berjaya Food 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 Berjaya Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Berjaya Food Bhd has no effect on the direction of Press Metal i.e., Press Metal and Berjaya Food go up and down completely randomly.
Pair Corralation between Press Metal and Berjaya Food
Assuming the 90 days trading horizon Press Metal Bhd is expected to generate 0.6 times more return on investment than Berjaya Food. However, Press Metal Bhd is 1.66 times less risky than Berjaya Food. It trades about 0.02 of its potential returns per unit of risk. Berjaya Food Bhd is currently generating about -0.03 per unit of risk. If you would invest 458.00 in Press Metal Bhd on November 3, 2024 and sell it today you would earn a total of 31.00 from holding Press Metal Bhd or generate 6.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Press Metal Bhd vs. Berjaya Food Bhd
Performance |
| Timeline |
| Press Metal Bhd |
| Berjaya Food Bhd |
Press Metal and Berjaya Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Press Metal and Berjaya Food
The main advantage of trading using opposite Press Metal and Berjaya Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Press Metal position performs unexpectedly, Berjaya Food 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 Berjaya Food will offset losses from the drop in Berjaya Food's long position.| Press Metal vs. ONETECH SOLUTIONS HOLDINGS | Press Metal vs. Malayan Banking Bhd | Press Metal vs. Petronas Chemicals Group | Press Metal vs. Cloudpoint Technology Berhad |
| Berjaya Food vs. Impiana Hotels Bhd | Berjaya Food vs. Sungei Bagan Rubber | Berjaya Food vs. YX Precious Metals | Berjaya Food vs. CB Industrial Product |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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