Correlation Between Airports and PTT Public
Can any of the company-specific risk be diversified away by investing in both Airports 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 Airports and PTT Public 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 PTT Public, you can compare the effects of market volatilities on Airports 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 Airports with a short position of PTT Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airports and PTT Public.
Diversification Opportunities for Airports and PTT Public
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Airports and PTT is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Airports of Thailand and PTT Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PTT 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 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 Airports i.e., Airports and PTT Public go up and down completely randomly.
Pair Corralation between Airports and PTT Public
Assuming the 90 days trading horizon Airports of Thailand is expected to under-perform the PTT Public. In addition to that, Airports is 1.01 times more volatile than PTT Public. It trades about -0.01 of its total potential returns per unit of risk. PTT Public is currently generating about 0.03 per unit of volatility. If you would invest 3,350 in PTT Public on August 24, 2024 and sell it today you would earn a total of 25.00 from holding PTT Public or generate 0.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Airports of Thailand vs. PTT Public
Performance |
| Timeline |
| Airports of Thailand |
| PTT Public |
Airports and PTT Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Airports and PTT Public
The main advantage of trading using opposite Airports and PTT Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airports 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.| Airports vs. CP ALL Public | Airports vs. PTT Public | Airports vs. Kasikornbank Public | Airports vs. Bangkok Dusit Medical |
| PTT Public vs. PTT Exploration and | PTT Public vs. The Siam Cement | PTT Public vs. CP ALL Public | PTT Public 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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