Correlation Between BCPG Public and Bound
Can any of the company-specific risk be diversified away by investing in both BCPG Public and Bound 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 BCPG Public and Bound into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BCPG Public and Bound and Beyond, you can compare the effects of market volatilities on BCPG Public and Bound 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 BCPG Public with a short position of Bound. Check out your portfolio center. Please also check ongoing floating volatility patterns of BCPG Public and Bound.
Diversification Opportunities for BCPG Public and Bound
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BCPG and Bound is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding BCPG Public and Bound and Beyond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bound and Beyond and BCPG Public 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 BCPG Public are associated (or correlated) with Bound. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bound and Beyond has no effect on the direction of BCPG Public i.e., BCPG Public and Bound go up and down completely randomly.
Pair Corralation between BCPG Public and Bound
Assuming the 90 days trading horizon BCPG Public is expected to generate 1.93 times more return on investment than Bound. However, BCPG Public is 1.93 times more volatile than Bound and Beyond. It trades about 0.03 of its potential returns per unit of risk. Bound and Beyond is currently generating about -0.18 per unit of risk. If you would invest 555.00 in BCPG Public on November 30, 2024 and sell it today you would earn a total of 10.00 from holding BCPG Public or generate 1.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.62% |
| Values | Daily Returns |
BCPG Public vs. Bound and Beyond
Performance |
| Timeline |
| BCPG Public |
| Bound and Beyond |
BCPG Public and Bound Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BCPG Public and Bound
The main advantage of trading using opposite BCPG Public and Bound positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BCPG Public position performs unexpectedly, Bound 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 Bound will offset losses from the drop in Bound's long position.| BCPG Public vs. Bangchak Public | BCPG Public vs. Gulf Energy Development | BCPG Public vs. Global Power Synergy | BCPG Public vs. Bangkok Expressway and |
| Bound vs. BCPG Public | Bound vs. Aqua Public | Bound vs. Energy Absolute Public | Bound vs. Bangkok Aviation Fuel |
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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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