Correlation Between Bangkok Chain and Vibhavadi Medical
Can any of the company-specific risk be diversified away by investing in both Bangkok Chain and Vibhavadi Medical 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 Chain and Vibhavadi Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bangkok Chain Hospital and Vibhavadi Medical Center, you can compare the effects of market volatilities on Bangkok Chain and Vibhavadi Medical 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 Chain with a short position of Vibhavadi Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bangkok Chain and Vibhavadi Medical.
Diversification Opportunities for Bangkok Chain and Vibhavadi Medical
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bangkok and Vibhavadi is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Bangkok Chain Hospital and Vibhavadi Medical Center in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vibhavadi Medical Center and Bangkok Chain 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 Chain Hospital are associated (or correlated) with Vibhavadi Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vibhavadi Medical Center has no effect on the direction of Bangkok Chain i.e., Bangkok Chain and Vibhavadi Medical go up and down completely randomly.
Pair Corralation between Bangkok Chain and Vibhavadi Medical
Assuming the 90 days trading horizon Bangkok Chain Hospital is expected to under-perform the Vibhavadi Medical. But the stock apears to be less risky and, when comparing its historical volatility, Bangkok Chain Hospital is 1.11 times less risky than Vibhavadi Medical. The stock trades about -0.42 of its potential returns per unit of risk. The Vibhavadi Medical Center is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 194.00 in Vibhavadi Medical Center on August 24, 2024 and sell it today you would earn a total of 12.00 from holding Vibhavadi Medical Center or generate 6.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bangkok Chain Hospital vs. Vibhavadi Medical Center
Performance |
| Timeline |
| Bangkok Chain Hospital |
| Vibhavadi Medical Center |
Bangkok Chain and Vibhavadi Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bangkok Chain and Vibhavadi Medical
The main advantage of trading using opposite Bangkok Chain and Vibhavadi Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bangkok Chain position performs unexpectedly, Vibhavadi Medical 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 Vibhavadi Medical will offset losses from the drop in Vibhavadi Medical's long position.| Bangkok Chain vs. Chularat Hospital Public | Bangkok Chain vs. Ekachai Medical Care | Bangkok Chain vs. Srivichaivejvivat Public |
| Vibhavadi Medical vs. Chularat Hospital Public | Vibhavadi Medical vs. Ekachai Medical Care | Vibhavadi Medical vs. Bangkok Chain Hospital | Vibhavadi Medical vs. Srivichaivejvivat 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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