Correlation Between Radiant Globaltech and Coraza Integrated

Can any of the company-specific risk be diversified away by investing in both Radiant Globaltech and Coraza Integrated 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 Radiant Globaltech and Coraza Integrated into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Radiant Globaltech Bhd and Coraza Integrated Technology, you can compare the effects of market volatilities on Radiant Globaltech and Coraza Integrated 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 Radiant Globaltech with a short position of Coraza Integrated. Check out your portfolio center. Please also check ongoing floating volatility patterns of Radiant Globaltech and Coraza Integrated.

Diversification Opportunities for Radiant Globaltech and Coraza Integrated

0.25

Correlation Coefficient

Radiant Globaltech  Coraza Integrated

Modest diversification

The 3 months correlation between Radiant and Coraza is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Radiant Globaltech Bhd and Coraza Integrated Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coraza Integrated and Radiant Globaltech 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 Radiant Globaltech Bhd are associated (or correlated) with Coraza Integrated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coraza Integrated has no effect on the direction of Radiant Globaltech i.e., Radiant Globaltech and Coraza Integrated go up and down completely randomly.

Pair Corralation between Radiant Globaltech and Coraza Integrated

Assuming the 90 days trading horizon Radiant Globaltech is expected to generate 1.66 times less return on investment than Coraza Integrated. But when comparing it to its historical volatility, Radiant Globaltech Bhd is 1.64 times less risky than Coraza Integrated. It trades about 0.06 of its potential returns per unit of risk. Coraza Integrated Technology is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  47.00  in Coraza Integrated Technology on November 29, 2024 and sell it today you would earn a total of  4.00  from holding Coraza Integrated Technology or generate 8.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Radiant Globaltech Bhd  vs.  Coraza Integrated Technology

Radiant Globaltech Bhd

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Radiant Globaltech Bhd are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Radiant Globaltech may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Coraza Integrated

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Coraza Integrated Technology are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Coraza Integrated disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Radiant Globaltech and Coraza Integrated

The main advantage of trading using opposite Radiant Globaltech and Coraza Integrated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Radiant Globaltech position performs unexpectedly, Coraza Integrated 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 Coraza Integrated will offset losses from the drop in Coraza Integrated's long position.

The idea behind Radiant Globaltech Bhd and Coraza Integrated Technology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.