Correlation Between Asian Sea and PTT Oil
Can any of the company-specific risk be diversified away by investing in both Asian Sea and PTT Oil 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 Asian Sea and PTT Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asian Sea and PTT Oil and, you can compare the effects of market volatilities on Asian Sea and PTT Oil 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 Asian Sea with a short position of PTT Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asian Sea and PTT Oil.
Diversification Opportunities for Asian Sea and PTT Oil
Good diversification
The 3 months correlation between Asian and PTT is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Asian Sea and PTT Oil and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PTT Oil and Asian Sea 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 Asian Sea are associated (or correlated) with PTT Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PTT Oil has no effect on the direction of Asian Sea i.e., Asian Sea and PTT Oil go up and down completely randomly.
Pair Corralation between Asian Sea and PTT Oil
Assuming the 90 days trading horizon Asian Sea is expected to generate 1.91 times more return on investment than PTT Oil. However, Asian Sea is 1.91 times more volatile than PTT Oil and. It trades about 0.08 of its potential returns per unit of risk. PTT Oil and is currently generating about -0.06 per unit of risk. If you would invest 633.00 in Asian Sea on August 25, 2024 and sell it today you would earn a total of 237.00 from holding Asian Sea or generate 37.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asian Sea vs. PTT Oil and
Performance |
| Timeline |
| Asian Sea |
| PTT Oil |
Asian Sea and PTT Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asian Sea and PTT Oil
The main advantage of trading using opposite Asian Sea and PTT Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asian Sea position performs unexpectedly, PTT Oil 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 Oil will offset losses from the drop in PTT Oil's long position.| Asian Sea vs. GFPT Public | Asian Sea vs. Carabao Group Public | Asian Sea vs. Thai Union Group | Asian Sea vs. Agripure Holdings Public |
| PTT Oil vs. PTT Public | PTT Oil vs. CP ALL Public | PTT Oil vs. Kasikornbank Public | PTT Oil 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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