Correlation Between Hartalega Holdings and Asian Pac
Can any of the company-specific risk be diversified away by investing in both Hartalega Holdings 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 Hartalega Holdings and Asian Pac into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hartalega Holdings Bhd and Asian Pac Holdings, you can compare the effects of market volatilities on Hartalega Holdings 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 Hartalega Holdings with a short position of Asian Pac. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartalega Holdings and Asian Pac.
Diversification Opportunities for Hartalega Holdings and Asian Pac
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hartalega and Asian is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Hartalega Holdings 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 Hartalega Holdings 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 Hartalega Holdings 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 Hartalega Holdings i.e., Hartalega Holdings and Asian Pac go up and down completely randomly.
Pair Corralation between Hartalega Holdings and Asian Pac
Assuming the 90 days trading horizon Hartalega Holdings Bhd is expected to generate 0.66 times more return on investment than Asian Pac. However, Hartalega Holdings Bhd is 1.52 times less risky than Asian Pac. It trades about 0.28 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 266.00 in Hartalega Holdings Bhd on September 25, 2024 and sell it today you would earn a total of 114.00 from holding Hartalega Holdings Bhd or generate 42.86% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 98.44% |
Values | Daily Returns |
Hartalega Holdings Bhd vs. Asian Pac Holdings
Performance |
Timeline |
Hartalega Holdings Bhd |
Asian Pac Holdings |
Hartalega Holdings and Asian Pac Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hartalega Holdings and Asian Pac
The main advantage of trading using opposite Hartalega Holdings and Asian Pac positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartalega Holdings 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.Hartalega Holdings vs. Top Glove | Hartalega Holdings vs. Kossan Rubber Industries | Hartalega Holdings vs. Rubberex M |
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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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