Correlation Between AAPICO Hitech and Namwiwat Medical
Can any of the company-specific risk be diversified away by investing in both AAPICO Hitech and Namwiwat Medical 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 Namwiwat Medical 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 Namwiwat Medical, you can compare the effects of market volatilities on AAPICO Hitech and Namwiwat Medical 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 Namwiwat Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of AAPICO Hitech and Namwiwat Medical.
Diversification Opportunities for AAPICO Hitech and Namwiwat Medical
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between AAPICO and Namwiwat is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding AAPICO Hitech Public and Namwiwat Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Namwiwat Medical 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 Namwiwat Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Namwiwat Medical has no effect on the direction of AAPICO Hitech i.e., AAPICO Hitech and Namwiwat Medical go up and down completely randomly.
Pair Corralation between AAPICO Hitech and Namwiwat Medical
Assuming the 90 days horizon AAPICO Hitech Public is expected to generate 1.78 times more return on investment than Namwiwat Medical. However, AAPICO Hitech is 1.78 times more volatile than Namwiwat Medical. It trades about -0.07 of its potential returns per unit of risk. Namwiwat Medical is currently generating about -0.19 per unit of risk. If you would invest 1,430 in AAPICO Hitech Public on November 27, 2024 and sell it today you would lose (40.00) from holding AAPICO Hitech Public or give up 2.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AAPICO Hitech Public vs. Namwiwat Medical
Performance |
| Timeline |
| AAPICO Hitech Public |
| Namwiwat Medical |
AAPICO Hitech and Namwiwat Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AAPICO Hitech and Namwiwat Medical
The main advantage of trading using opposite AAPICO Hitech and Namwiwat Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AAPICO Hitech position performs unexpectedly, Namwiwat Medical 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 Namwiwat Medical will offset losses from the drop in Namwiwat Medical's long position.| AAPICO Hitech vs. S Hotels and | AAPICO Hitech vs. Asia Hotel Public | AAPICO Hitech vs. MFC Asset Management | AAPICO Hitech vs. Laguna Resorts Hotels |
| Namwiwat Medical vs. Chularat Hospital Public | Namwiwat Medical vs. Nonthavej Hospital Public | Namwiwat Medical vs. Bhiraj Office Leasehold | Namwiwat Medical vs. Wattanapat Hospital Trang |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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