Correlation Between Bangkok Chain and Workpoint Entertainment
Can any of the company-specific risk be diversified away by investing in both Bangkok Chain and Workpoint 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 Workpoint 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 Workpoint Entertainment Public, you can compare the effects of market volatilities on Bangkok Chain and Workpoint 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 Workpoint Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bangkok Chain and Workpoint Entertainment.
Diversification Opportunities for Bangkok Chain and Workpoint Entertainment
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bangkok and Workpoint is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Bangkok Chain Hospital and Workpoint Entertainment Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Workpoint Entertainment 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 Workpoint Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Workpoint Entertainment has no effect on the direction of Bangkok Chain i.e., Bangkok Chain and Workpoint Entertainment go up and down completely randomly.
Pair Corralation between Bangkok Chain and Workpoint Entertainment
Assuming the 90 days trading horizon Bangkok Chain Hospital is expected to under-perform the Workpoint Entertainment. But the stock apears to be less risky and, when comparing its historical volatility, Bangkok Chain Hospital is 29.16 times less risky than Workpoint Entertainment. The stock trades about -0.01 of its potential returns per unit of risk. The Workpoint Entertainment Public is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,821 in Workpoint Entertainment Public on September 2, 2024 and sell it today you would lose (1,041) from holding Workpoint Entertainment Public or give up 57.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bangkok Chain Hospital vs. Workpoint Entertainment Public
Performance |
| Timeline |
| Bangkok Chain Hospital |
| Workpoint Entertainment |
Bangkok Chain and Workpoint Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bangkok Chain and Workpoint Entertainment
The main advantage of trading using opposite Bangkok Chain and Workpoint Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bangkok Chain position performs unexpectedly, Workpoint 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 Workpoint Entertainment will offset losses from the drop in Workpoint 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 |
| Workpoint Entertainment vs. Bangkok Chain Hospital | Workpoint Entertainment vs. Grande Asset Hotels | Workpoint Entertainment vs. Better World Green | Workpoint 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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