Correlation Between Genetec Technology and Heineken Bhd
Can any of the company-specific risk be diversified away by investing in both Genetec Technology and Heineken Bhd 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 Genetec Technology and Heineken Bhd into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genetec Technology Bhd and Heineken Bhd, you can compare the effects of market volatilities on Genetec Technology and Heineken Bhd 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 Genetec Technology with a short position of Heineken Bhd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genetec Technology and Heineken Bhd.
Diversification Opportunities for Genetec Technology and Heineken Bhd
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Genetec and Heineken is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Genetec Technology Bhd and Heineken Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heineken Bhd and Genetec Technology 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 Genetec Technology Bhd are associated (or correlated) with Heineken Bhd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heineken Bhd has no effect on the direction of Genetec Technology i.e., Genetec Technology and Heineken Bhd go up and down completely randomly.
Pair Corralation between Genetec Technology and Heineken Bhd
Assuming the 90 days trading horizon Genetec Technology Bhd is expected to generate 5.55 times more return on investment than Heineken Bhd. However, Genetec Technology is 5.55 times more volatile than Heineken Bhd. It trades about 0.08 of its potential returns per unit of risk. Heineken Bhd is currently generating about 0.08 per unit of risk. If you would invest 98.00 in Genetec Technology Bhd on September 25, 2024 and sell it today you would earn a total of 26.00 from holding Genetec Technology Bhd or generate 26.53% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 98.44% |
Values | Daily Returns |
Genetec Technology Bhd vs. Heineken Bhd
Performance |
Timeline |
Genetec Technology Bhd |
Heineken Bhd |
Genetec Technology and Heineken Bhd Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Genetec Technology and Heineken Bhd
The main advantage of trading using opposite Genetec Technology and Heineken Bhd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genetec Technology position performs unexpectedly, Heineken Bhd 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 Heineken Bhd will offset losses from the drop in Heineken Bhd's long position.Genetec Technology vs. Greatech Technology Bhd | Genetec Technology vs. Uwc Bhd | Genetec Technology vs. PIE Industrial Bhd | Genetec Technology vs. Dufu Tech Corp |
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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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