Correlation Between Swift Haulage and AMMB Holdings

Can any of the company-specific risk be diversified away by investing in both Swift Haulage and AMMB 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 Swift Haulage and AMMB Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Swift Haulage and AMMB Holdings

-0.12

Correlation Coefficient

Swift Haulage  AMMB Holdings

Good diversification

The 3 months correlation between Swift and AMMB is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Swift Haulage Bhd and AMMB Holdings Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMMB Holdings Bhd and Swift Haulage 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 Swift Haulage Bhd are associated (or correlated) with AMMB Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMMB Holdings Bhd has no effect on the direction of Swift Haulage i.e., Swift Haulage and AMMB Holdings go up and down completely randomly.

Pair Corralation between Swift Haulage and AMMB Holdings

Assuming the 90 days trading horizon Swift Haulage Bhd is expected to under-perform the AMMB Holdings. In addition to that, Swift Haulage is 1.55 times more volatile than AMMB Holdings Bhd. It trades about -0.04 of its total potential returns per unit of risk. AMMB Holdings Bhd is currently generating about 0.13 per unit of volatility. If you would invest  529.00  in AMMB Holdings Bhd on November 29, 2024 and sell it today you would earn a total of  42.00  from holding AMMB Holdings Bhd or generate 7.94% return on investment over 90 days.

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

Swift Haulage Bhd  vs.  AMMB Holdings Bhd

Swift Haulage Bhd

Risk-Adjusted Performance

Very Weak

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

AMMB Holdings Bhd

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in AMMB Holdings Bhd are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, AMMB Holdings may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Pair Trading with Swift Haulage and AMMB Holdings

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

The idea behind Swift Haulage Bhd and AMMB 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.