Correlation Between Union Auction and Ama Marine
Can any of the company-specific risk be diversified away by investing in both Union Auction and Ama Marine 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 Union Auction and Ama Marine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Union Auction Public and Ama Marine Public, you can compare the effects of market volatilities on Union Auction and Ama Marine 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 Union Auction with a short position of Ama Marine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Union Auction and Ama Marine.
Diversification Opportunities for Union Auction and Ama Marine
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Union and Ama is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Union Auction Public and Ama Marine Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ama Marine Public and Union Auction 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 Union Auction Public are associated (or correlated) with Ama Marine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ama Marine Public has no effect on the direction of Union Auction i.e., Union Auction and Ama Marine go up and down completely randomly.
Pair Corralation between Union Auction and Ama Marine
Assuming the 90 days trading horizon Union Auction Public is expected to under-perform the Ama Marine. In addition to that, Union Auction is 1.16 times more volatile than Ama Marine Public. It trades about -0.42 of its total potential returns per unit of risk. Ama Marine Public is currently generating about -0.2 per unit of volatility. If you would invest 434.00 in Ama Marine Public on August 25, 2024 and sell it today you would lose (18.00) from holding Ama Marine Public or give up 4.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Union Auction Public vs. Ama Marine Public
Performance |
| Timeline |
| Union Auction Public |
| Ama Marine Public |
Union Auction and Ama Marine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Union Auction and Ama Marine
The main advantage of trading using opposite Union Auction and Ama Marine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Union Auction position performs unexpectedly, Ama Marine 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 Ama Marine will offset losses from the drop in Ama Marine's long position.| Union Auction vs. AP Public | Union Auction vs. Carabao Group Public | Union Auction vs. Forth Smart Service | Union Auction vs. Com7 PCL |
| Ama Marine vs. Arrow Syndicate Public | Ama Marine vs. After You Public | Ama Marine vs. Union Auction Public | Ama Marine vs. Akkhie Prakarn 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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