Correlation Between Bank of Ayudhya and CH Karnchang
Can any of the company-specific risk be diversified away by investing in both Bank of Ayudhya and CH Karnchang 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 Bank of Ayudhya and CH Karnchang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank of Ayudhya and CH Karnchang Public, you can compare the effects of market volatilities on Bank of Ayudhya and CH Karnchang 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 Bank of Ayudhya with a short position of CH Karnchang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Ayudhya and CH Karnchang.
Diversification Opportunities for Bank of Ayudhya and CH Karnchang
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bank and CH Karnchang is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Ayudhya and CH Karnchang Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CH Karnchang Public and Bank of Ayudhya 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 Bank of Ayudhya are associated (or correlated) with CH Karnchang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CH Karnchang Public has no effect on the direction of Bank of Ayudhya i.e., Bank of Ayudhya and CH Karnchang go up and down completely randomly.
Pair Corralation between Bank of Ayudhya and CH Karnchang
Assuming the 90 days trading horizon Bank of Ayudhya is expected to generate 0.49 times more return on investment than CH Karnchang. However, Bank of Ayudhya is 2.06 times less risky than CH Karnchang. It trades about 0.0 of its potential returns per unit of risk. CH Karnchang Public is currently generating about -0.14 per unit of risk. If you would invest 2,500 in Bank of Ayudhya on September 1, 2024 and sell it today you would earn a total of 0.00 from holding Bank of Ayudhya or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Bank of Ayudhya vs. CH Karnchang Public
Performance |
| Timeline |
| Bank of Ayudhya |
| CH Karnchang Public |
Bank of Ayudhya and CH Karnchang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of Ayudhya and CH Karnchang
The main advantage of trading using opposite Bank of Ayudhya and CH Karnchang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Ayudhya position performs unexpectedly, CH Karnchang 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 CH Karnchang will offset losses from the drop in CH Karnchang's long position.| Bank of Ayudhya vs. Bangkok Bank Public | Bank of Ayudhya vs. Krung Thai Bank | Bank of Ayudhya vs. SCB X Public | Bank of Ayudhya vs. Kasikornbank Public |
| CH Karnchang vs. Gulf Energy Development | CH Karnchang vs. Energy Absolute Public | CH Karnchang vs. WHA Public | CH Karnchang vs. Bangkok Expressway and |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data |