Correlation Between Advanced Info and SCB X
Can any of the company-specific risk be diversified away by investing in both Advanced Info and SCB X 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 Advanced Info and SCB X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advanced Info Service and SCB X Public, you can compare the effects of market volatilities on Advanced Info and SCB X 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 Advanced Info with a short position of SCB X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advanced Info and SCB X.
Diversification Opportunities for Advanced Info and SCB X
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Advanced and SCB is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Info Service and SCB X Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCB X Public and Advanced Info 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 Advanced Info Service are associated (or correlated) with SCB X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCB X Public has no effect on the direction of Advanced Info i.e., Advanced Info and SCB X go up and down completely randomly.
Pair Corralation between Advanced Info and SCB X
Assuming the 90 days trading horizon Advanced Info Service is expected to generate 1.83 times more return on investment than SCB X. However, Advanced Info is 1.83 times more volatile than SCB X Public. It trades about 0.14 of its potential returns per unit of risk. SCB X Public is currently generating about 0.0 per unit of risk. If you would invest 27,100 in Advanced Info Service on August 28, 2024 and sell it today you would earn a total of 1,200 from holding Advanced Info Service or generate 4.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advanced Info Service vs. SCB X Public
Performance |
| Timeline |
| Advanced Info Service |
| SCB X Public |
Advanced Info and SCB X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advanced Info and SCB X
The main advantage of trading using opposite Advanced Info and SCB X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advanced Info position performs unexpectedly, SCB X 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 SCB X will offset losses from the drop in SCB X's long position.| Advanced Info vs. Indara Insurance Public | Advanced Info vs. Regional Container Lines | Advanced Info vs. Regional Container Lines | Advanced Info vs. Mahachai Hospital Public |
| SCB X vs. Thai Energy Storage | SCB X vs. Royal Orchid Hotel | SCB X vs. Grand Canal Land | SCB X vs. PRG Public |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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