Correlation Between KL Technology and Ocean Vantage
Can any of the company-specific risk be diversified away by investing in both KL Technology and Ocean Vantage 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 KL Technology and Ocean Vantage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KL Technology and Ocean Vantage Holdings, you can compare the effects of market volatilities on KL Technology and Ocean Vantage 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 KL Technology with a short position of Ocean Vantage. Check out your portfolio center. Please also check ongoing floating volatility patterns of KL Technology and Ocean Vantage.
Diversification Opportunities for KL Technology and Ocean Vantage
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between KLTE and Ocean is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding KL Technology and Ocean Vantage Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ocean Vantage Holdings and KL Technology 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 KL Technology are associated (or correlated) with Ocean Vantage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ocean Vantage Holdings has no effect on the direction of KL Technology i.e., KL Technology and Ocean Vantage go up and down completely randomly.
Pair Corralation between KL Technology and Ocean Vantage
Assuming the 90 days trading horizon KL Technology is expected to generate 0.36 times more return on investment than Ocean Vantage. However, KL Technology is 2.75 times less risky than Ocean Vantage. It trades about -0.01 of its potential returns per unit of risk. Ocean Vantage Holdings is currently generating about -0.02 per unit of risk. If you would invest 6,381 in KL Technology on August 29, 2024 and sell it today you would lose (415.00) from holding KL Technology or give up 6.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KL Technology vs. Ocean Vantage Holdings
Performance |
| Timeline |
KL Technology and Ocean Vantage Volatility Contrast
Predicted Return Density |
| Returns |
KL Technology
Pair trading matchups for KL Technology
Ocean Vantage Holdings
Pair trading matchups for Ocean Vantage
Pair Trading with KL Technology and Ocean Vantage
The main advantage of trading using opposite KL Technology and Ocean Vantage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KL Technology position performs unexpectedly, Ocean Vantage 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 Ocean Vantage will offset losses from the drop in Ocean Vantage's long position.| KL Technology vs. Ho Hup Construction | KL Technology vs. Sunway Construction Group | KL Technology vs. FARM FRESH BERHAD | KL Technology vs. Alliance Financial Group |
| Ocean Vantage vs. Malayan Banking Bhd | Ocean Vantage vs. Public Bank Bhd | Ocean Vantage vs. Petronas Chemicals Group | Ocean Vantage vs. IHH Healthcare 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 CEOs Directory module to screen CEOs from public companies around the world.
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