Correlation Between APAC Resources and Cal-Bay Intl

Can any of the company-specific risk be diversified away by investing in both APAC Resources and Cal-Bay Intl 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 APAC Resources and Cal-Bay Intl into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between APAC Resources Limited and Cal Bay Intl, you can compare the effects of market volatilities on APAC Resources and Cal-Bay Intl 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 APAC Resources with a short position of Cal-Bay Intl. Check out your portfolio center. Please also check ongoing floating volatility patterns of APAC Resources and Cal-Bay Intl.

Diversification Opportunities for APAC Resources and Cal-Bay Intl

0.0

Correlation Coefficient

APAC Resources  Cal-Bay Intl

Pay attention - limited upside

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

Pair Corralation between APAC Resources and Cal-Bay Intl

If you would invest  10.00  in APAC Resources Limited on September 4, 2024 and sell it today you would earn a total of  1.00  from holding APAC Resources Limited or generate 10.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	88.89%
Values	Daily Returns

APAC Resources Limited  vs.  Cal Bay Intl

APAC Resources

Risk-Adjusted Performance

0 of 100

OK

Over the last 90 days APAC Resources Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly conflicting fundamental indicators, APAC Resources may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Cal Bay Intl

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with APAC Resources and Cal-Bay Intl

The main advantage of trading using opposite APAC Resources and Cal-Bay Intl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if APAC Resources position performs unexpectedly, Cal-Bay Intl 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 Cal-Bay Intl will offset losses from the drop in Cal-Bay Intl's long position.

The idea behind APAC Resources Limited and Cal Bay Intl 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.