Correlation Between TAS Offshore and Rubberex M

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

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

Diversification Opportunities for TAS Offshore and Rubberex M

0.71

Correlation Coefficient

TAS Offshore  Rubberex M

Poor diversification

The 3 months correlation between TAS and Rubberex is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding TAS Offshore Bhd and Rubberex M in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rubberex M and TAS Offshore 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 TAS Offshore Bhd are associated (or correlated) with Rubberex M. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rubberex M has no effect on the direction of TAS Offshore i.e., TAS Offshore and Rubberex M go up and down completely randomly.

Pair Corralation between TAS Offshore and Rubberex M

Assuming the 90 days trading horizon TAS Offshore Bhd is expected to generate 0.52 times more return on investment than Rubberex M. However, TAS Offshore Bhd is 1.91 times less risky than Rubberex M. It trades about -0.04 of its potential returns per unit of risk. Rubberex M is currently generating about -0.08 per unit of risk. If you would invest  63.00  in TAS Offshore Bhd on December 29, 2024 and sell it today you would lose (4.00) from holding TAS Offshore Bhd or give up 6.35% of portfolio value over 90 days.

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

TAS Offshore Bhd  vs.  Rubberex M

TAS Offshore Bhd

Risk-Adjusted Performance

Very Weak

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

Rubberex M

Risk-Adjusted Performance

Very Weak

Over the last 90 days Rubberex M has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with TAS Offshore and Rubberex M

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

The idea behind TAS Offshore Bhd and Rubberex M 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.