Correlation Between Bangkok Dusit and EMC Public
Can any of the company-specific risk be diversified away by investing in both Bangkok Dusit and EMC Public 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 Dusit and EMC Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bangkok Dusit Medical and EMC Public, you can compare the effects of market volatilities on Bangkok Dusit and EMC Public 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 Dusit with a short position of EMC Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bangkok Dusit and EMC Public.
Diversification Opportunities for Bangkok Dusit and EMC Public
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Bangkok and EMC is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Bangkok Dusit Medical and EMC Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EMC Public and Bangkok Dusit 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 Dusit Medical are associated (or correlated) with EMC Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EMC Public has no effect on the direction of Bangkok Dusit i.e., Bangkok Dusit and EMC Public go up and down completely randomly.
Pair Corralation between Bangkok Dusit and EMC Public
Assuming the 90 days trading horizon Bangkok Dusit Medical is expected to generate 0.28 times more return on investment than EMC Public. However, Bangkok Dusit Medical is 3.59 times less risky than EMC Public. It trades about 0.04 of its potential returns per unit of risk. EMC Public is currently generating about -0.15 per unit of risk. If you would invest 2,390 in Bangkok Dusit Medical on December 1, 2024 and sell it today you would earn a total of 30.00 from holding Bangkok Dusit Medical or generate 1.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bangkok Dusit Medical vs. EMC Public
Performance |
| Timeline |
| Bangkok Dusit Medical |
| EMC Public |
Bangkok Dusit and EMC Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bangkok Dusit and EMC Public
The main advantage of trading using opposite Bangkok Dusit and EMC Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bangkok Dusit position performs unexpectedly, EMC Public 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 EMC Public will offset losses from the drop in EMC Public's long position.| Bangkok Dusit vs. Bumrungrad Hospital PCL | Bangkok Dusit vs. Bangkok Chain Hospital | Bangkok Dusit vs. Ramkhamhaeng Hospital Public | Bangkok Dusit vs. Vibhavadi Medical Center |
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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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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