Correlation Between PTRA and Sime Darby
Can any of the company-specific risk be diversified away by investing in both PTRA and Sime Darby 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 PTRA and Sime Darby into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PTRA and Sime Darby Bhd, you can compare the effects of market volatilities on PTRA and Sime Darby 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 PTRA with a short position of Sime Darby. Check out your portfolio center. Please also check ongoing floating volatility patterns of PTRA and Sime Darby.
Diversification Opportunities for PTRA and Sime Darby
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PTRA and Sime is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding PTRA and Sime Darby Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sime Darby Bhd and PTRA 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 PTRA are associated (or correlated) with Sime Darby. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sime Darby Bhd has no effect on the direction of PTRA i.e., PTRA and Sime Darby go up and down completely randomly.
Pair Corralation between PTRA and Sime Darby
If you would invest 51.00 in Sime Darby Bhd on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Sime Darby Bhd or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 12.5% |
| Values | Daily Returns |
PTRA vs. Sime Darby Bhd
Performance |
| Timeline |
| PTRA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Sime Darby Bhd |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
PTRA and Sime Darby Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PTRA and Sime Darby
The main advantage of trading using opposite PTRA and Sime Darby positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PTRA position performs unexpectedly, Sime Darby 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 Sime Darby will offset losses from the drop in Sime Darby's long position.| PTRA vs. Faraday Future Intelligent | PTRA vs. Mullen Automotive | PTRA vs. Canoo Inc | PTRA vs. Hyzon Motors |
| Sime Darby vs. Zapp Electric Vehicles | Sime Darby vs. First Hydrogen Corp | Sime Darby vs. Guangzhou Automobile Group | Sime Darby vs. Phoenix Motor Common |
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 Stocks Directory module to find actively traded stocks across global markets.
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