Correlation Between Bangkok Chain and Wave Entertainment
Can any of the company-specific risk be diversified away by investing in both Bangkok Chain and Wave Entertainment 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 Wave Entertainment 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 Wave Entertainment Public, you can compare the effects of market volatilities on Bangkok Chain and Wave Entertainment 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 Wave Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bangkok Chain and Wave Entertainment.
Diversification Opportunities for Bangkok Chain and Wave Entertainment
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bangkok and Wave is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Bangkok Chain Hospital and Wave Entertainment Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wave Entertainment Public 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 Wave Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wave Entertainment Public has no effect on the direction of Bangkok Chain i.e., Bangkok Chain and Wave Entertainment go up and down completely randomly.
Pair Corralation between Bangkok Chain and Wave Entertainment
Assuming the 90 days trading horizon Bangkok Chain Hospital is expected to generate 0.26 times more return on investment than Wave Entertainment. However, Bangkok Chain Hospital is 3.79 times less risky than Wave Entertainment. It trades about -0.14 of its potential returns per unit of risk. Wave Entertainment Public is currently generating about -0.11 per unit of risk. If you would invest 1,740 in Bangkok Chain Hospital on September 2, 2024 and sell it today you would lose (80.00) from holding Bangkok Chain Hospital or give up 4.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bangkok Chain Hospital vs. Wave Entertainment Public
Performance |
| Timeline |
| Bangkok Chain Hospital |
| Wave Entertainment Public |
Bangkok Chain and Wave Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bangkok Chain and Wave Entertainment
The main advantage of trading using opposite Bangkok Chain and Wave Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bangkok Chain position performs unexpectedly, Wave Entertainment 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 Wave Entertainment will offset losses from the drop in Wave Entertainment's long position.| Bangkok Chain vs. AP Public | Bangkok Chain vs. Advanced Information Technology | Bangkok Chain vs. AJ Plast Public | Bangkok Chain vs. Berli Jucker Public |
| Wave Entertainment vs. Bangkok Chain Hospital | Wave Entertainment vs. Grande Asset Hotels | Wave Entertainment vs. Better World Green | Wave Entertainment vs. Chularat Hospital 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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