Correlation Between Resintech Bhd and PPB Group
Can any of the company-specific risk be diversified away by investing in both Resintech Bhd 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 Resintech Bhd and PPB Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Resintech Bhd and PPB Group Bhd, you can compare the effects of market volatilities on Resintech Bhd 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 Resintech Bhd with a short position of PPB Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Resintech Bhd and PPB Group.
Diversification Opportunities for Resintech Bhd and PPB Group
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Resintech and PPB is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Resintech 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 Resintech 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 Resintech 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 Resintech Bhd i.e., Resintech Bhd and PPB Group go up and down completely randomly.
Pair Corralation between Resintech Bhd and PPB Group
Assuming the 90 days trading horizon Resintech Bhd is expected to generate 1.2 times more return on investment than PPB Group. However, Resintech Bhd is 1.2 times more volatile than PPB Group Bhd. It trades about 0.05 of its potential returns per unit of risk. PPB Group Bhd is currently generating about -0.21 per unit of risk. If you would invest 67.00 in Resintech Bhd on September 25, 2024 and sell it today you would earn a total of 3.00 from holding Resintech Bhd or generate 4.48% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Resintech Bhd vs. PPB Group Bhd
Performance |
Timeline |
Resintech Bhd |
PPB Group Bhd |
Resintech Bhd and PPB Group Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Resintech Bhd and PPB Group
The main advantage of trading using opposite Resintech Bhd and PPB Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Resintech Bhd 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.Resintech Bhd vs. Sunway Construction Group | Resintech Bhd vs. Notion Vtec Bhd | Resintech Bhd vs. Inari Amertron Bhd | Resintech Bhd vs. ViTrox Bhd |
PPB Group vs. Central Industrial Corp | PPB Group vs. Supercomnet Technologies Bhd | PPB Group vs. Resintech Bhd | PPB Group vs. Cloudpoint Technology Berhad |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
Content Syndication Quickly integrate customizable finance content to your own investment portal | |
Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |