Correlation Between Sapura Industrial and YX Precious
Can any of the company-specific risk be diversified away by investing in both Sapura Industrial and YX Precious 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 Sapura Industrial and YX Precious into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sapura Industrial Bhd and YX Precious Metals, you can compare the effects of market volatilities on Sapura Industrial and YX Precious 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 Sapura Industrial with a short position of YX Precious. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sapura Industrial and YX Precious.
Diversification Opportunities for Sapura Industrial and YX Precious
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sapura and 0250 is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Sapura Industrial Bhd and YX Precious Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YX Precious Metals and Sapura Industrial 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 Sapura Industrial Bhd are associated (or correlated) with YX Precious. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YX Precious Metals has no effect on the direction of Sapura Industrial i.e., Sapura Industrial and YX Precious go up and down completely randomly.
Pair Corralation between Sapura Industrial and YX Precious
Assuming the 90 days trading horizon Sapura Industrial Bhd is expected to generate 0.9 times more return on investment than YX Precious. However, Sapura Industrial Bhd is 1.11 times less risky than YX Precious. It trades about 0.0 of its potential returns per unit of risk. YX Precious Metals is currently generating about -0.02 per unit of risk. If you would invest 87.00 in Sapura Industrial Bhd on September 26, 2024 and sell it today you would lose (1.00) from holding Sapura Industrial Bhd or give up 1.15% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Sapura Industrial Bhd vs. YX Precious Metals
Performance |
Timeline |
Sapura Industrial Bhd |
YX Precious Metals |
Sapura Industrial and YX Precious Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sapura Industrial and YX Precious
The main advantage of trading using opposite Sapura Industrial and YX Precious positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sapura Industrial position performs unexpectedly, YX Precious 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 YX Precious will offset losses from the drop in YX Precious' long position.Sapura Industrial vs. Eversafe Rubber Bhd | Sapura Industrial vs. Nexgram Holdings Bhd | Sapura Industrial vs. ViTrox Bhd | Sapura Industrial vs. ECS ICT Bhd |
YX Precious vs. Malayan Banking Bhd | YX Precious vs. Public Bank Bhd | YX Precious vs. Petronas Chemicals Group | YX Precious vs. Tenaga Nasional Bhd |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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