Correlation Between KL Technology and PMB Technology
Can any of the company-specific risk be diversified away by investing in both KL Technology and PMB Technology 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 PMB Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KL Technology and PMB Technology Bhd, you can compare the effects of market volatilities on KL Technology and PMB Technology 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 PMB Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of KL Technology and PMB Technology.
Diversification Opportunities for KL Technology and PMB Technology
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between KLTE and PMB is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding KL Technology and PMB Technology Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PMB Technology 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 PMB Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PMB Technology Bhd has no effect on the direction of KL Technology i.e., KL Technology and PMB Technology go up and down completely randomly.
Pair Corralation between KL Technology and PMB Technology
Assuming the 90 days trading horizon KL Technology is expected to under-perform the PMB Technology. But the index apears to be less risky and, when comparing its historical volatility, KL Technology is 2.44 times less risky than PMB Technology. The index trades about -0.01 of its potential returns per unit of risk. The PMB Technology Bhd is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 174.00 in PMB Technology Bhd on August 25, 2024 and sell it today you would earn a total of 3.00 from holding PMB Technology Bhd or generate 1.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KL Technology vs. PMB Technology Bhd
Performance |
| Timeline |
KL Technology and PMB Technology Volatility Contrast
Predicted Return Density |
| Returns |
KL Technology
Pair trading matchups for KL Technology
PMB Technology Bhd
Pair trading matchups for PMB Technology
Pair Trading with KL Technology and PMB Technology
The main advantage of trading using opposite KL Technology and PMB Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KL Technology position performs unexpectedly, PMB Technology 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 PMB Technology will offset losses from the drop in PMB Technology's long position.| KL Technology vs. MyTech Group Bhd | KL Technology vs. Supercomnet Technologies Bhd | KL Technology vs. Sunzen Biotech Bhd | KL Technology vs. Duopharma Biotech Bhd |
| PMB Technology vs. Tex Cycle Technology | PMB Technology vs. Aeon Credit Service | PMB Technology vs. Public Bank Bhd | PMB Technology vs. Alliance Financial Group |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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