Correlation Between ECS ICT and OSK Holdings

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Can any of the company-specific risk be diversified away by investing in both ECS ICT and OSK Holdings 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 ECS ICT and OSK Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ECS ICT Bhd and OSK Holdings Bhd, you can compare the effects of market volatilities on ECS ICT and OSK Holdings 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 ECS ICT with a short position of OSK Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of ECS ICT and OSK Holdings.

Diversification Opportunities for ECS ICT and OSK Holdings

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between ECS and OSK is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ECS ICT Bhd and OSK Holdings Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OSK Holdings Bhd and ECS ICT 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 ECS ICT Bhd are associated (or correlated) with OSK Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OSK Holdings Bhd has no effect on the direction of ECS ICT i.e., ECS ICT and OSK Holdings go up and down completely randomly.

Pair Corralation between ECS ICT and OSK Holdings

If you would invest (100.00) in OSK Holdings Bhd on December 27, 2024 and sell it today you would earn a total of  100.00  from holding OSK Holdings Bhd or generate -100.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

ECS ICT Bhd  vs.  OSK Holdings Bhd

 Performance 
       Timeline  
ECS ICT Bhd 

Risk-Adjusted Performance

Very Weak

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

Risk-Adjusted Performance

Very Weak

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

ECS ICT and OSK Holdings Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with ECS ICT and OSK Holdings

The main advantage of trading using opposite ECS ICT and OSK Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ECS ICT position performs unexpectedly, OSK Holdings 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 OSK Holdings will offset losses from the drop in OSK Holdings' long position.
The idea behind ECS ICT Bhd and OSK Holdings 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.
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..

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