Correlation Between Bangkok Bank and Charan Insurance
Can any of the company-specific risk be diversified away by investing in both Bangkok Bank and Charan Insurance 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 Bangkok Bank and Charan Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bangkok Bank Public and Charan Insurance Public, you can compare the effects of market volatilities on Bangkok Bank and Charan Insurance 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 Bangkok Bank with a short position of Charan Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bangkok Bank and Charan Insurance.
Diversification Opportunities for Bangkok Bank and Charan Insurance
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bangkok and Charan is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Bangkok Bank Public and Charan Insurance Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Charan Insurance Public and Bangkok Bank 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 Bangkok Bank Public are associated (or correlated) with Charan Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Charan Insurance Public has no effect on the direction of Bangkok Bank i.e., Bangkok Bank and Charan Insurance go up and down completely randomly.
Pair Corralation between Bangkok Bank and Charan Insurance
Assuming the 90 days trading horizon Bangkok Bank is expected to generate 81.18 times less return on investment than Charan Insurance. But when comparing it to its historical volatility, Bangkok Bank Public is 83.32 times less risky than Charan Insurance. It trades about 0.1 of its potential returns per unit of risk. Charan Insurance Public is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 0.00 in Charan Insurance Public on November 2, 2024 and sell it today you would earn a total of 2,030 from holding Charan Insurance Public or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bangkok Bank Public vs. Charan Insurance Public
Performance |
| Timeline |
| Bangkok Bank Public |
| Charan Insurance Public |
Bangkok Bank and Charan Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bangkok Bank and Charan Insurance
The main advantage of trading using opposite Bangkok Bank and Charan Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bangkok Bank position performs unexpectedly, Charan Insurance 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 Charan Insurance will offset losses from the drop in Charan Insurance's long position.| Bangkok Bank vs. SCB X Public | Bangkok Bank vs. Kasikornbank Public | Bangkok Bank vs. PTT Public | Bangkok Bank vs. The Siam Cement |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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