Correlation Between Ekarat Engineering and BCPG Public
Can any of the company-specific risk be diversified away by investing in both Ekarat Engineering and BCPG Public 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 Ekarat Engineering and BCPG Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ekarat Engineering Public and BCPG Public, you can compare the effects of market volatilities on Ekarat Engineering and BCPG Public 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 Ekarat Engineering with a short position of BCPG Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ekarat Engineering and BCPG Public.
Diversification Opportunities for Ekarat Engineering and BCPG Public
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ekarat and BCPG is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Ekarat Engineering Public and BCPG Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BCPG Public and Ekarat Engineering 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 Ekarat Engineering Public are associated (or correlated) with BCPG Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BCPG Public has no effect on the direction of Ekarat Engineering i.e., Ekarat Engineering and BCPG Public go up and down completely randomly.
Pair Corralation between Ekarat Engineering and BCPG Public
Assuming the 90 days trading horizon Ekarat Engineering Public is expected to generate 0.96 times more return on investment than BCPG Public. However, Ekarat Engineering Public is 1.04 times less risky than BCPG Public. It trades about 0.01 of its potential returns per unit of risk. BCPG Public is currently generating about -0.54 per unit of risk. If you would invest 92.00 in Ekarat Engineering Public on September 2, 2024 and sell it today you would earn a total of 0.00 from holding Ekarat Engineering Public or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ekarat Engineering Public vs. BCPG Public
Performance |
| Timeline |
| Ekarat Engineering Public |
| BCPG Public |
Ekarat Engineering and BCPG Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ekarat Engineering and BCPG Public
The main advantage of trading using opposite Ekarat Engineering and BCPG Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ekarat Engineering position performs unexpectedly, BCPG Public 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 BCPG Public will offset losses from the drop in BCPG Public's long position.| Ekarat Engineering vs. Gulf Energy Development | Ekarat Engineering vs. Energy Absolute Public | Ekarat Engineering vs. WHA Public | Ekarat Engineering vs. Bangkok Expressway and |
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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