Correlation Between Amata Summit and CP Tower
Can any of the company-specific risk be diversified away by investing in both Amata Summit and CP Tower 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 Amata Summit and CP Tower into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amata Summit Growth and CP Tower Growth, you can compare the effects of market volatilities on Amata Summit and CP Tower 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 Amata Summit with a short position of CP Tower. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amata Summit and CP Tower.
Diversification Opportunities for Amata Summit and CP Tower
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Amata and CPTGF is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Amata Summit Growth and CP Tower Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CP Tower Growth and Amata Summit 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 Amata Summit Growth are associated (or correlated) with CP Tower. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CP Tower Growth has no effect on the direction of Amata Summit i.e., Amata Summit and CP Tower go up and down completely randomly.
Pair Corralation between Amata Summit and CP Tower
Assuming the 90 days trading horizon Amata Summit Growth is expected to generate 1.45 times more return on investment than CP Tower. However, Amata Summit is 1.45 times more volatile than CP Tower Growth. It trades about 0.3 of its potential returns per unit of risk. CP Tower Growth is currently generating about -0.65 per unit of risk. If you would invest 644.00 in Amata Summit Growth on September 4, 2024 and sell it today you would earn a total of 31.00 from holding Amata Summit Growth or generate 4.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 27.27% |
| Values | Daily Returns |
Amata Summit Growth vs. CP Tower Growth
Performance |
| Timeline |
| Amata Summit Growth |
| CP Tower Growth |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
Amata Summit and CP Tower Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amata Summit and CP Tower
The main advantage of trading using opposite Amata Summit and CP Tower positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amata Summit position performs unexpectedly, CP Tower 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 CP Tower will offset losses from the drop in CP Tower's long position.| Amata Summit vs. WHA Premium Growth | Amata Summit vs. AIM Industrial Growth | Amata Summit vs. Bangkok Commercial Property | Amata Summit vs. Quality Houses Property |
| CP Tower vs. WHA Premium Growth | CP Tower vs. CPN Commercial Growth | CP Tower vs. Centara Hotels Resorts | CP Tower vs. Future Park Leasehold |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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