Correlation Between Bonia Bhd and JF Technology

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

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

Diversification Opportunities for Bonia Bhd and JF Technology

0.0

Correlation Coefficient

Bonia Bhd  JF Technology

Pay attention - limited upside

The 3 months correlation between Bonia and 0146 is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Bonia Bhd and JF Technology BHD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JF Technology BHD and Bonia Bhd 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 Bonia Bhd are associated (or correlated) with JF Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JF Technology BHD has no effect on the direction of Bonia Bhd i.e., Bonia Bhd and JF Technology go up and down completely randomly.

Pair Corralation between Bonia Bhd and JF Technology

Assuming the 90 days trading horizon Bonia Bhd is expected to generate 0.8 times more return on investment than JF Technology. However, Bonia Bhd is 1.25 times less risky than JF Technology. It trades about 0.03 of its potential returns per unit of risk. JF Technology BHD is currently generating about -0.23 per unit of risk. If you would invest  131.00  in Bonia Bhd on December 24, 2024 and sell it today you would earn a total of  4.00  from holding Bonia Bhd or generate 3.05% return on investment over 90 days.

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

Bonia Bhd  vs.  JF Technology BHD

Bonia Bhd

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Bonia Bhd are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Bonia Bhd is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

JF Technology BHD

Risk-Adjusted Performance

Very Weak

Over the last 90 days JF Technology BHD 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 Bonia Bhd and JF Technology

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

The idea behind Bonia Bhd and JF 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.

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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.