Correlation Between AP Public and GFPT Public
Can any of the company-specific risk be diversified away by investing in both AP Public and GFPT 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 AP Public and GFPT Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AP Public and GFPT Public, you can compare the effects of market volatilities on AP Public and GFPT 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 AP Public with a short position of GFPT Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of AP Public and GFPT Public.
Diversification Opportunities for AP Public and GFPT Public
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between AP Public and GFPT is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding AP Public and GFPT Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GFPT Public and AP Public 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 AP Public are associated (or correlated) with GFPT Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GFPT Public has no effect on the direction of AP Public i.e., AP Public and GFPT Public go up and down completely randomly.
Pair Corralation between AP Public and GFPT Public
Assuming the 90 days horizon AP Public is expected to under-perform the GFPT Public. But the stock apears to be less risky and, when comparing its historical volatility, AP Public is 1.0 times less risky than GFPT Public. The stock trades about -0.27 of its potential returns per unit of risk. The GFPT Public is currently generating about -0.12 of returns per unit of risk over similar time horizon. If you would invest 1,110 in GFPT Public on September 1, 2024 and sell it today you would lose (50.00) from holding GFPT Public or give up 4.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AP Public vs. GFPT Public
Performance |
| Timeline |
| AP Public |
| GFPT Public |
AP Public and GFPT Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AP Public and GFPT Public
The main advantage of trading using opposite AP Public and GFPT Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AP Public position performs unexpectedly, GFPT 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 GFPT Public will offset losses from the drop in GFPT Public's long position.The idea behind AP Public and GFPT Public pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| GFPT Public vs. MK Restaurant Group | GFPT Public vs. TRC Construction Public | GFPT Public vs. Bangkok Expressway and | GFPT Public vs. Lohakit Metal Public |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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