Correlation Between Airports and Mitsib Leasing
Can any of the company-specific risk be diversified away by investing in both Airports and Mitsib Leasing 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 Airports and Mitsib Leasing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Airports of Thailand and Mitsib Leasing Public, you can compare the effects of market volatilities on Airports and Mitsib Leasing 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 Airports with a short position of Mitsib Leasing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airports and Mitsib Leasing.
Diversification Opportunities for Airports and Mitsib Leasing
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Airports and Mitsib is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Airports of Thailand and Mitsib Leasing Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitsib Leasing Public and Airports 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 Airports of Thailand are associated (or correlated) with Mitsib Leasing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitsib Leasing Public has no effect on the direction of Airports i.e., Airports and Mitsib Leasing go up and down completely randomly.
Pair Corralation between Airports and Mitsib Leasing
Assuming the 90 days trading horizon Airports of Thailand is expected to under-perform the Mitsib Leasing. But the stock apears to be less risky and, when comparing its historical volatility, Airports of Thailand is 48.14 times less risky than Mitsib Leasing. The stock trades about -0.03 of its potential returns per unit of risk. The Mitsib Leasing Public is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 96.00 in Mitsib Leasing Public on September 12, 2024 and sell it today you would lose (23.00) from holding Mitsib Leasing Public or give up 23.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Airports of Thailand vs. Mitsib Leasing Public
Performance |
| Timeline |
| Airports of Thailand |
| Mitsib Leasing Public |
Airports and Mitsib Leasing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Airports and Mitsib Leasing
The main advantage of trading using opposite Airports and Mitsib Leasing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airports position performs unexpectedly, Mitsib Leasing 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 Mitsib Leasing will offset losses from the drop in Mitsib Leasing's long position.| Airports vs. CP ALL Public | Airports vs. PTT Public | Airports vs. Kasikornbank Public | Airports vs. Bangkok Dusit Medical |
| Mitsib Leasing vs. Multibax Public | Mitsib Leasing vs. The Erawan Group | Mitsib Leasing vs. Jay Mart Public | Mitsib Leasing vs. Airports of Thailand |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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