Correlation Between AAPICO Hitech and CHUWIT FARM
Can any of the company-specific risk be diversified away by investing in both AAPICO Hitech and CHUWIT FARM 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 AAPICO Hitech and CHUWIT FARM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AAPICO Hitech Public and CHUWIT FARM PUBLIC, you can compare the effects of market volatilities on AAPICO Hitech and CHUWIT FARM 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 AAPICO Hitech with a short position of CHUWIT FARM. Check out your portfolio center. Please also check ongoing floating volatility patterns of AAPICO Hitech and CHUWIT FARM.
Diversification Opportunities for AAPICO Hitech and CHUWIT FARM
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AAPICO and CHUWIT is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding AAPICO Hitech Public and CHUWIT FARM PUBLIC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHUWIT FARM PUBLIC and AAPICO Hitech 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 AAPICO Hitech Public are associated (or correlated) with CHUWIT FARM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHUWIT FARM PUBLIC has no effect on the direction of AAPICO Hitech i.e., AAPICO Hitech and CHUWIT FARM go up and down completely randomly.
Pair Corralation between AAPICO Hitech and CHUWIT FARM
Assuming the 90 days horizon AAPICO Hitech Public is expected to generate 0.47 times more return on investment than CHUWIT FARM. However, AAPICO Hitech Public is 2.11 times less risky than CHUWIT FARM. It trades about -0.03 of its potential returns per unit of risk. CHUWIT FARM PUBLIC is currently generating about -0.06 per unit of risk. If you would invest 2,746 in AAPICO Hitech Public on August 31, 2024 and sell it today you would lose (926.00) from holding AAPICO Hitech Public or give up 33.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 26.13% |
| Values | Daily Returns |
AAPICO Hitech Public vs. CHUWIT FARM PUBLIC
Performance |
| Timeline |
| AAPICO Hitech Public |
| CHUWIT FARM PUBLIC |
AAPICO Hitech and CHUWIT FARM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AAPICO Hitech and CHUWIT FARM
The main advantage of trading using opposite AAPICO Hitech and CHUWIT FARM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AAPICO Hitech position performs unexpectedly, CHUWIT FARM 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 CHUWIT FARM will offset losses from the drop in CHUWIT FARM's long position.| AAPICO Hitech vs. TRC Construction Public | AAPICO Hitech vs. Bangkok Expressway and | AAPICO Hitech vs. Lohakit Metal Public | AAPICO Hitech vs. Gunkul Engineering Public |
| CHUWIT FARM vs. AP Public | CHUWIT FARM vs. TRC Construction Public | CHUWIT FARM vs. Bangkok Expressway and | CHUWIT FARM vs. Lohakit Metal 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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