Correlation Between Armada Hflr and Teo Seng

Can any of the company-specific risk be diversified away by investing in both Armada Hflr and Teo Seng 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 Armada Hflr and Teo Seng into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Armada Hflr Pr and Teo Seng Capital, you can compare the effects of market volatilities on Armada Hflr and Teo Seng 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 Armada Hflr with a short position of Teo Seng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and Teo Seng.

Diversification Opportunities for Armada Hflr and Teo Seng

0.59

Correlation Coefficient

Armada Hflr  Teo Seng

Very weak diversification

The 3 months correlation between Armada and Teo is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and Teo Seng Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teo Seng Capital and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with Teo Seng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teo Seng Capital has no effect on the direction of Armada Hflr i.e., Armada Hflr and Teo Seng go up and down completely randomly.

Pair Corralation between Armada Hflr and Teo Seng

Considering the 90-day investment horizon Armada Hflr Pr is expected to under-perform the Teo Seng. But the stock apears to be less risky and, when comparing its historical volatility, Armada Hflr Pr is 1.76 times less risky than Teo Seng. The stock trades about -0.01 of its potential returns per unit of risk. The Teo Seng Capital is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  46.00  in Teo Seng Capital on October 3, 2024 and sell it today you would earn a total of  64.00  from holding Teo Seng Capital or generate 139.13% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.13%
Values	Daily Returns

Armada Hflr Pr  vs.  Teo Seng Capital

Armada Hflr Pr

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Armada Hflr Pr has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical indicators, Armada Hflr is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Teo Seng Capital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Teo Seng Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Armada Hflr and Teo Seng

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

The idea behind Armada Hflr Pr and Teo Seng Capital 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..