Correlation Between Keck Seng and Motorcar Parts
Can any of the company-specific risk be diversified away by investing in both Keck Seng and Motorcar Parts 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 Keck Seng and Motorcar Parts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Keck Seng Investments and Motorcar Parts of, you can compare the effects of market volatilities on Keck Seng and Motorcar Parts 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 Keck Seng with a short position of Motorcar Parts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keck Seng and Motorcar Parts.
Diversification Opportunities for Keck Seng and Motorcar Parts
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Keck and Motorcar is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Keck Seng Investments and Motorcar Parts of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Motorcar Parts and Keck Seng 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 Keck Seng Investments are associated (or correlated) with Motorcar Parts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Motorcar Parts has no effect on the direction of Keck Seng i.e., Keck Seng and Motorcar Parts go up and down completely randomly.
Pair Corralation between Keck Seng and Motorcar Parts
Assuming the 90 days horizon Keck Seng Investments is expected to generate 1.32 times more return on investment than Motorcar Parts. However, Keck Seng is 1.32 times more volatile than Motorcar Parts of. It trades about 0.06 of its potential returns per unit of risk. Motorcar Parts of is currently generating about 0.0 per unit of risk. If you would invest 11.00 in Keck Seng Investments on October 13, 2024 and sell it today you would earn a total of 17.00 from holding Keck Seng Investments or generate 154.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Keck Seng Investments vs. Motorcar Parts of
Performance |
| Timeline |
| Keck Seng Investments |
| Motorcar Parts |
Keck Seng and Motorcar Parts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Keck Seng and Motorcar Parts
The main advantage of trading using opposite Keck Seng and Motorcar Parts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keck Seng position performs unexpectedly, Motorcar Parts 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 Motorcar Parts will offset losses from the drop in Motorcar Parts' long position.| Keck Seng vs. Marriott International | Keck Seng vs. Hyatt Hotels | Keck Seng vs. InterContinental Hotels Group | Keck Seng vs. INTERCONT HOTELS |
| Motorcar Parts vs. HK Electric Investments | Motorcar Parts vs. SLR Investment Corp | Motorcar Parts vs. Keck Seng Investments | Motorcar Parts vs. Ribbon Communications |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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