Correlation Between MyTech Group and Binasat Communications
Can any of the company-specific risk be diversified away by investing in both MyTech Group and Binasat Communications 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 MyTech Group and Binasat Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MyTech Group Bhd and Binasat Communications Bhd, you can compare the effects of market volatilities on MyTech Group and Binasat Communications 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 MyTech Group with a short position of Binasat Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of MyTech Group and Binasat Communications.
Diversification Opportunities for MyTech Group and Binasat Communications
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between MyTech and Binasat is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding MyTech Group Bhd and Binasat Communications Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Binasat Communications and MyTech Group 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 MyTech Group Bhd are associated (or correlated) with Binasat Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Binasat Communications has no effect on the direction of MyTech Group i.e., MyTech Group and Binasat Communications go up and down completely randomly.
Pair Corralation between MyTech Group and Binasat Communications
Assuming the 90 days trading horizon MyTech Group Bhd is expected to generate 1.32 times more return on investment than Binasat Communications. However, MyTech Group is 1.32 times more volatile than Binasat Communications Bhd. It trades about -0.01 of its potential returns per unit of risk. Binasat Communications Bhd is currently generating about -0.1 per unit of risk. If you would invest 41.00 in MyTech Group Bhd on September 23, 2024 and sell it today you would lose (2.00) from holding MyTech Group Bhd or give up 4.88% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 98.46% |
Values | Daily Returns |
MyTech Group Bhd vs. Binasat Communications Bhd
Performance |
Timeline |
MyTech Group Bhd |
Binasat Communications |
MyTech Group and Binasat Communications Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with MyTech Group and Binasat Communications
The main advantage of trading using opposite MyTech Group and Binasat Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MyTech Group position performs unexpectedly, Binasat Communications 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 Binasat Communications will offset losses from the drop in Binasat Communications' long position.MyTech Group vs. Greatech Technology Bhd | MyTech Group vs. Uwc Bhd | MyTech Group vs. Genetec Technology Bhd | MyTech Group vs. PIE Industrial 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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