Correlation Between Malayan Banking and Aozora Bank
Can any of the company-specific risk be diversified away by investing in both Malayan Banking and Aozora Bank 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 Malayan Banking and Aozora Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Malayan Banking Berhad and Aozora Bank, you can compare the effects of market volatilities on Malayan Banking and Aozora Bank 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 Malayan Banking with a short position of Aozora Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Malayan Banking and Aozora Bank.
Diversification Opportunities for Malayan Banking and Aozora Bank
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Malayan and Aozora is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Malayan Banking Berhad and Aozora Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aozora Bank and Malayan Banking 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 Malayan Banking Berhad are associated (or correlated) with Aozora Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aozora Bank has no effect on the direction of Malayan Banking i.e., Malayan Banking and Aozora Bank go up and down completely randomly.
Pair Corralation between Malayan Banking and Aozora Bank
If you would invest 1,989 in Aozora Bank on October 7, 2024 and sell it today you would earn a total of 0.00 from holding Aozora Bank or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Malayan Banking Berhad vs. Aozora Bank
Performance |
| Timeline |
| Malayan Banking Berhad |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Aozora Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Malayan Banking and Aozora Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Malayan Banking and Aozora Bank
The main advantage of trading using opposite Malayan Banking and Aozora Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Malayan Banking position performs unexpectedly, Aozora Bank 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 Aozora Bank will offset losses from the drop in Aozora Bank's long position.The idea behind Malayan Banking Berhad and Aozora Bank pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Aozora Bank vs. Zoom Video Communications | Aozora Bank vs. Jerash Holdings | Aozora Bank vs. Universal Music Group | Aozora Bank vs. Mills Music Trust |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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