Correlation Between KL Technology and QL Resources
Can any of the company-specific risk be diversified away by investing in both KL Technology and QL Resources 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 QL Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KL Technology and QL Resources Bhd, you can compare the effects of market volatilities on KL Technology and QL Resources 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 QL Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of KL Technology and QL Resources.
Diversification Opportunities for KL Technology and QL Resources
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between KLTE and 7084 is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding KL Technology and QL Resources Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QL Resources Bhd 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 QL Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QL Resources Bhd has no effect on the direction of KL Technology i.e., KL Technology and QL Resources go up and down completely randomly.
Pair Corralation between KL Technology and QL Resources
Assuming the 90 days trading horizon KL Technology is expected to generate 1.22 times less return on investment than QL Resources. In addition to that, KL Technology is 1.85 times more volatile than QL Resources Bhd. It trades about 0.03 of its total potential returns per unit of risk. QL Resources Bhd is currently generating about 0.07 per unit of volatility. If you would invest 481.00 in QL Resources Bhd on September 3, 2024 and sell it today you would earn a total of 6.00 from holding QL Resources Bhd or generate 1.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KL Technology vs. QL Resources Bhd
Performance |
| Timeline |
KL Technology and QL Resources Volatility Contrast
Predicted Return Density |
| Returns |
KL Technology
Pair trading matchups for KL Technology
QL Resources Bhd
Pair trading matchups for QL Resources
Pair Trading with KL Technology and QL Resources
The main advantage of trading using opposite KL Technology and QL Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KL Technology position performs unexpectedly, QL Resources 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 QL Resources will offset losses from the drop in QL Resources' long position.| KL Technology vs. Computer Forms Bhd | KL Technology vs. Lyc Healthcare Bhd | KL Technology vs. Senheng New Retail | KL Technology vs. Uchi Technologies Bhd |
| QL Resources vs. Al Aqar Healthcare | QL Resources vs. PMB Technology Bhd | QL Resources vs. Icon Offshore Bhd | QL Resources vs. JF Technology 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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