Correlation Between Asia Metal and PTT Public
Can any of the company-specific risk be diversified away by investing in both Asia Metal and PTT 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 Asia Metal and PTT Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asia Metal Public and PTT Public, you can compare the effects of market volatilities on Asia Metal and PTT 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 Asia Metal with a short position of PTT Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asia Metal and PTT Public.
Diversification Opportunities for Asia Metal and PTT Public
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Asia and PTT is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Asia Metal Public and PTT Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PTT Public and Asia Metal 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 Asia Metal Public are associated (or correlated) with PTT Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PTT Public has no effect on the direction of Asia Metal i.e., Asia Metal and PTT Public go up and down completely randomly.
Pair Corralation between Asia Metal and PTT Public
Assuming the 90 days trading horizon Asia Metal Public is expected to under-perform the PTT Public. In addition to that, Asia Metal is 1.5 times more volatile than PTT Public. It trades about -0.34 of its total potential returns per unit of risk. PTT Public is currently generating about -0.16 per unit of volatility. If you would invest 3,350 in PTT Public on September 1, 2024 and sell it today you would lose (125.00) from holding PTT Public or give up 3.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asia Metal Public vs. PTT Public
Performance |
| Timeline |
| Asia Metal Public |
| PTT Public |
Asia Metal and PTT Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asia Metal and PTT Public
The main advantage of trading using opposite Asia Metal and PTT Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asia Metal position performs unexpectedly, PTT 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 PTT Public will offset losses from the drop in PTT Public's long position.| Asia Metal vs. 2S Metal Public | Asia Metal vs. AAPICO Hitech Public | Asia Metal vs. CSP Steel Center | Asia Metal vs. Bangsaphan Barmill Public |
| PTT Public vs. IRPC Public | PTT Public vs. PTT Oil and | PTT Public vs. Power Solution Technologies | PTT Public vs. Star Petroleum Refining |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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