Correlation Between OSK Holdings and Heineken Bhd
Can any of the company-specific risk be diversified away by investing in both OSK Holdings 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 OSK Holdings and Heineken Bhd into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OSK Holdings Bhd and Heineken Bhd, you can compare the effects of market volatilities on OSK Holdings 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 OSK Holdings with a short position of Heineken Bhd. Check out your portfolio center. Please also check ongoing floating volatility patterns of OSK Holdings and Heineken Bhd.
Diversification Opportunities for OSK Holdings and Heineken Bhd
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between OSK and Heineken is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding OSK Holdings Bhd and Heineken Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heineken Bhd and OSK Holdings 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 OSK Holdings 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 OSK Holdings i.e., OSK Holdings and Heineken Bhd go up and down completely randomly.
Pair Corralation between OSK Holdings and Heineken Bhd
Assuming the 90 days trading horizon OSK Holdings Bhd is expected to generate 0.99 times more return on investment than Heineken Bhd. However, OSK Holdings Bhd is 1.01 times less risky than Heineken Bhd. It trades about 0.11 of its potential returns per unit of risk. Heineken Bhd is currently generating about 0.02 per unit of risk. If you would invest 88.00 in OSK Holdings Bhd on September 25, 2024 and sell it today you would earn a total of 86.00 from holding OSK Holdings Bhd or generate 97.73% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
OSK Holdings Bhd vs. Heineken Bhd
Performance |
Timeline |
OSK Holdings Bhd |
Heineken Bhd |
OSK Holdings and Heineken Bhd Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with OSK Holdings and Heineken Bhd
The main advantage of trading using opposite OSK Holdings and Heineken Bhd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OSK Holdings 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.OSK Holdings vs. Asian Pac Holdings | OSK Holdings vs. RHB Bank Bhd | OSK Holdings vs. ECS ICT Bhd | OSK Holdings vs. Silver Ridge Holdings |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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