Correlation Between Al Aqar and OSK Holdings
Can any of the company-specific risk be diversified away by investing in both Al Aqar and OSK Holdings 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 Al Aqar and OSK Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Al Aqar Healthcare and OSK Holdings Bhd, you can compare the effects of market volatilities on Al Aqar and OSK Holdings 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 Al Aqar with a short position of OSK Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Al Aqar and OSK Holdings.
Diversification Opportunities for Al Aqar and OSK Holdings
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between 5116 and OSK is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Al Aqar Healthcare and OSK Holdings Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OSK Holdings Bhd and Al Aqar 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 Al Aqar Healthcare are associated (or correlated) with OSK Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OSK Holdings Bhd has no effect on the direction of Al Aqar i.e., Al Aqar and OSK Holdings go up and down completely randomly.
Pair Corralation between Al Aqar and OSK Holdings
Assuming the 90 days trading horizon Al Aqar is expected to generate 3.96 times less return on investment than OSK Holdings. But when comparing it to its historical volatility, Al Aqar Healthcare is 1.33 times less risky than OSK Holdings. It trades about 0.03 of its potential returns per unit of risk. OSK Holdings Bhd is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 163.00 in OSK Holdings Bhd on September 24, 2024 and sell it today you would earn a total of 11.00 from holding OSK Holdings Bhd or generate 6.75% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 98.46% |
Values | Daily Returns |
Al Aqar Healthcare vs. OSK Holdings Bhd
Performance |
Timeline |
Al Aqar Healthcare |
OSK Holdings Bhd |
Al Aqar and OSK Holdings Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Al Aqar and OSK Holdings
The main advantage of trading using opposite Al Aqar and OSK Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Al Aqar position performs unexpectedly, OSK Holdings 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 OSK Holdings will offset losses from the drop in OSK Holdings' long position.Al Aqar vs. YTL Hospitality REIT | Al Aqar vs. OSK Holdings Bhd | Al Aqar vs. FARM FRESH BERHAD | Al Aqar vs. Pentamaster 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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