Correlation Between Uchi Technologies and PPB Group
Can any of the company-specific risk be diversified away by investing in both Uchi Technologies and PPB Group 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 Uchi Technologies and PPB Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uchi Technologies Bhd and PPB Group Bhd, you can compare the effects of market volatilities on Uchi Technologies and PPB Group 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 Uchi Technologies with a short position of PPB Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uchi Technologies and PPB Group.
Diversification Opportunities for Uchi Technologies and PPB Group
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Uchi and PPB is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Uchi Technologies Bhd and PPB Group Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PPB Group Bhd and Uchi Technologies 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 Uchi Technologies Bhd are associated (or correlated) with PPB Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PPB Group Bhd has no effect on the direction of Uchi Technologies i.e., Uchi Technologies and PPB Group go up and down completely randomly.
Pair Corralation between Uchi Technologies and PPB Group
Assuming the 90 days trading horizon Uchi Technologies Bhd is expected to generate 0.89 times more return on investment than PPB Group. However, Uchi Technologies Bhd is 1.12 times less risky than PPB Group. It trades about 0.08 of its potential returns per unit of risk. PPB Group Bhd is currently generating about -0.05 per unit of risk. If you would invest 277.00 in Uchi Technologies Bhd on September 26, 2024 and sell it today you would earn a total of 110.00 from holding Uchi Technologies Bhd or generate 39.71% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Uchi Technologies Bhd vs. PPB Group Bhd
Performance |
Timeline |
Uchi Technologies Bhd |
PPB Group Bhd |
Uchi Technologies and PPB Group Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Uchi Technologies and PPB Group
The main advantage of trading using opposite Uchi Technologies and PPB Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uchi Technologies position performs unexpectedly, PPB Group 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 PPB Group will offset losses from the drop in PPB Group's long position.Uchi Technologies vs. K One Technology Bhd | Uchi Technologies vs. Kuala Lumpur Kepong | Uchi Technologies vs. Genetec Technology Bhd | Uchi Technologies vs. RHB Bank 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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