Correlation Between MyTech Group and Cloudpoint Technology
Can any of the company-specific risk be diversified away by investing in both MyTech Group and Cloudpoint Technology 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 Cloudpoint Technology 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 Cloudpoint Technology Berhad, you can compare the effects of market volatilities on MyTech Group and Cloudpoint Technology 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 Cloudpoint Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of MyTech Group and Cloudpoint Technology.
Diversification Opportunities for MyTech Group and Cloudpoint Technology
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MyTech and Cloudpoint is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding MyTech Group Bhd and Cloudpoint Technology Berhad in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cloudpoint Technology 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 Cloudpoint Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cloudpoint Technology has no effect on the direction of MyTech Group i.e., MyTech Group and Cloudpoint Technology go up and down completely randomly.
Pair Corralation between MyTech Group and Cloudpoint Technology
Assuming the 90 days trading horizon MyTech Group is expected to generate 6.2 times less return on investment than Cloudpoint Technology. In addition to that, MyTech Group is 1.37 times more volatile than Cloudpoint Technology Berhad. It trades about 0.01 of its total potential returns per unit of risk. Cloudpoint Technology Berhad is currently generating about 0.07 per unit of volatility. If you would invest 49.00 in Cloudpoint Technology Berhad on September 23, 2024 and sell it today you would earn a total of 44.00 from holding Cloudpoint Technology Berhad or generate 89.8% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 80.41% |
Values | Daily Returns |
MyTech Group Bhd vs. Cloudpoint Technology Berhad
Performance |
Timeline |
MyTech Group Bhd |
Cloudpoint Technology |
MyTech Group and Cloudpoint Technology Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with MyTech Group and Cloudpoint Technology
The main advantage of trading using opposite MyTech Group and Cloudpoint Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MyTech Group position performs unexpectedly, Cloudpoint Technology 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 Cloudpoint Technology will offset losses from the drop in Cloudpoint Technology's 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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