Correlation Between SSF Home and OpenSys M

Can any of the company-specific risk be diversified away by investing in both SSF Home and OpenSys M 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 SSF Home and OpenSys M into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SSF Home Group and OpenSys M Bhd, you can compare the effects of market volatilities on SSF Home and OpenSys M 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 SSF Home with a short position of OpenSys M. Check out your portfolio center. Please also check ongoing floating volatility patterns of SSF Home and OpenSys M.

Diversification Opportunities for SSF Home and OpenSys M

-0.39

Correlation Coefficient

SSF Home  OpenSys M

Very good diversification

The 3 months correlation between SSF and OpenSys is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding SSF Home Group and OpenSys M Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OpenSys M Bhd and SSF Home 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 SSF Home Group are associated (or correlated) with OpenSys M. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OpenSys M Bhd has no effect on the direction of SSF Home i.e., SSF Home and OpenSys M go up and down completely randomly.

Pair Corralation between SSF Home and OpenSys M

Assuming the 90 days trading horizon SSF Home Group is expected to generate 1.06 times more return on investment than OpenSys M. However, SSF Home is 1.06 times more volatile than OpenSys M Bhd. It trades about -0.05 of its potential returns per unit of risk. OpenSys M Bhd is currently generating about -0.05 per unit of risk. If you would invest  40.00  in SSF Home Group on October 10, 2024 and sell it today you would lose (5.00) from holding SSF Home Group or give up 12.5% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

SSF Home Group  vs.  OpenSys M Bhd

SSF Home Group

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in SSF Home Group are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, SSF Home may actually be approaching a critical reversion point that can send shares even higher in February 2025.

OpenSys M Bhd

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days OpenSys M Bhd has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, OpenSys M is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with SSF Home and OpenSys M

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

The idea behind SSF Home Group and OpenSys M Bhd 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.