Correlation Between MAS Financial and State Bank

Can any of the company-specific risk be diversified away by investing in both MAS Financial and State Bank 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 MAS Financial and State Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between MAS Financial Services and State Bank of, you can compare the effects of market volatilities on MAS Financial and State Bank 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 MAS Financial with a short position of State Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of MAS Financial and State Bank.

Diversification Opportunities for MAS Financial and State Bank

0.89

Correlation Coefficient

MAS Financial  State Bank

Very poor diversification

The 3 months correlation between MAS and State is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding MAS Financial Services and State Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Bank and MAS Financial 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 MAS Financial Services are associated (or correlated) with State Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Bank has no effect on the direction of MAS Financial i.e., MAS Financial and State Bank go up and down completely randomly.

Pair Corralation between MAS Financial and State Bank

Assuming the 90 days trading horizon MAS Financial Services is expected to generate 1.46 times more return on investment than State Bank. However, MAS Financial is 1.46 times more volatile than State Bank of. It trades about -0.13 of its potential returns per unit of risk. State Bank of is currently generating about -0.25 per unit of risk. If you would invest  27,431  in MAS Financial Services on December 1, 2024 and sell it today you would lose (4,076) from holding MAS Financial Services or give up 14.86% of portfolio value over 90 days.

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

MAS Financial Services  vs.  State Bank of

MAS Financial Services

Risk-Adjusted Performance

Very Weak

Over the last 90 days MAS Financial Services has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

State Bank

Risk-Adjusted Performance

Very Weak

Over the last 90 days State Bank of has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with MAS Financial and State Bank

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

The idea behind MAS Financial Services and State Bank of 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.