Correlation Between Awanbiru Technology and K One

Can any of the company-specific risk be diversified away by investing in both Awanbiru Technology and K One 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 Awanbiru Technology and K One into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Awanbiru Technology and K One

0.23

Correlation Coefficient

Awanbiru Technology  K One

Modest diversification

The 3 months correlation between Awanbiru and 0111 is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Awanbiru Technology Bhd and K One Technology Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on K One Technology and Awanbiru Technology 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 Awanbiru Technology Bhd are associated (or correlated) with K One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of K One Technology has no effect on the direction of Awanbiru Technology i.e., Awanbiru Technology and K One go up and down completely randomly.

Pair Corralation between Awanbiru Technology and K One

Assuming the 90 days trading horizon Awanbiru Technology Bhd is expected to generate 0.82 times more return on investment than K One. However, Awanbiru Technology Bhd is 1.22 times less risky than K One. It trades about 0.03 of its potential returns per unit of risk. K One Technology Bhd is currently generating about 0.02 per unit of risk. If you would invest  31.00  in Awanbiru Technology Bhd on November 19, 2024 and sell it today you would earn a total of  1.00  from holding Awanbiru Technology Bhd or generate 3.23% return on investment over 90 days.

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

Awanbiru Technology Bhd  vs.  K One Technology Bhd

Awanbiru Technology Bhd

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Awanbiru Technology Bhd are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Awanbiru Technology may actually be approaching a critical reversion point that can send shares even higher in March 2025.

K One Technology

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in K One Technology Bhd are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, K One 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 Awanbiru Technology and K One

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

The idea behind Awanbiru Technology Bhd and K One Technology 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..