Correlation Between Inari Amertron and FARM FRESH
Can any of the company-specific risk be diversified away by investing in both Inari Amertron and FARM FRESH 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 Inari Amertron and FARM FRESH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inari Amertron Bhd and FARM FRESH BERHAD, you can compare the effects of market volatilities on Inari Amertron and FARM FRESH 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 Inari Amertron with a short position of FARM FRESH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inari Amertron and FARM FRESH.
Diversification Opportunities for Inari Amertron and FARM FRESH
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Inari and FARM is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Inari Amertron Bhd and FARM FRESH BERHAD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FARM FRESH BERHAD and Inari Amertron 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 Inari Amertron Bhd are associated (or correlated) with FARM FRESH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FARM FRESH BERHAD has no effect on the direction of Inari Amertron i.e., Inari Amertron and FARM FRESH go up and down completely randomly.
Pair Corralation between Inari Amertron and FARM FRESH
Assuming the 90 days trading horizon Inari Amertron Bhd is expected to generate 1.79 times more return on investment than FARM FRESH. However, Inari Amertron is 1.79 times more volatile than FARM FRESH BERHAD. It trades about 0.1 of its potential returns per unit of risk. FARM FRESH BERHAD is currently generating about 0.12 per unit of risk. If you would invest 292.00 in Inari Amertron Bhd on September 25, 2024 and sell it today you would earn a total of 13.00 from holding Inari Amertron Bhd or generate 4.45% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 95.45% |
Values | Daily Returns |
Inari Amertron Bhd vs. FARM FRESH BERHAD
Performance |
Timeline |
Inari Amertron Bhd |
FARM FRESH BERHAD |
Inari Amertron and FARM FRESH Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Inari Amertron and FARM FRESH
The main advantage of trading using opposite Inari Amertron and FARM FRESH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inari Amertron position performs unexpectedly, FARM FRESH 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 FARM FRESH will offset losses from the drop in FARM FRESH's long position.Inari Amertron vs. ViTrox Bhd | Inari Amertron vs. MI Technovation Bhd | Inari Amertron vs. Globetronics Tech Bhd |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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