Correlation Between Heineken Bhd and Asian Pac
Can any of the company-specific risk be diversified away by investing in both Heineken Bhd and Asian Pac 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 Heineken Bhd and Asian Pac into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Heineken Bhd and Asian Pac Holdings, you can compare the effects of market volatilities on Heineken Bhd and Asian Pac 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 Heineken Bhd with a short position of Asian Pac. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heineken Bhd and Asian Pac.
Diversification Opportunities for Heineken Bhd and Asian Pac
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Heineken and Asian is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Heineken Bhd and Asian Pac Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asian Pac Holdings and Heineken Bhd 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 Heineken Bhd are associated (or correlated) with Asian Pac. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asian Pac Holdings has no effect on the direction of Heineken Bhd i.e., Heineken Bhd and Asian Pac go up and down completely randomly.
Pair Corralation between Heineken Bhd and Asian Pac
Assuming the 90 days trading horizon Heineken Bhd is expected to generate 0.42 times more return on investment than Asian Pac. However, Heineken Bhd is 2.39 times less risky than Asian Pac. It trades about 0.08 of its potential returns per unit of risk. Asian Pac Holdings is currently generating about -0.03 per unit of risk. If you would invest 2,255 in Heineken Bhd on September 25, 2024 and sell it today you would earn a total of 139.00 from holding Heineken Bhd or generate 6.16% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Heineken Bhd vs. Asian Pac Holdings
Performance |
Timeline |
Heineken Bhd |
Asian Pac Holdings |
Heineken Bhd and Asian Pac Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Heineken Bhd and Asian Pac
The main advantage of trading using opposite Heineken Bhd and Asian Pac positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heineken Bhd position performs unexpectedly, Asian Pac 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 Asian Pac will offset losses from the drop in Asian Pac's long position.Heineken Bhd vs. Carlsberg Brewery Malaysia | Heineken Bhd vs. Genetec Technology Bhd | Heineken Bhd vs. Sunway Construction Group | Heineken Bhd vs. Dagang Nexchange 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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