Correlation Between Bangkok Dusit and Frasers Property
Can any of the company-specific risk be diversified away by investing in both Bangkok Dusit and Frasers Property 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 Frasers Property 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 Frasers Property Public, you can compare the effects of market volatilities on Bangkok Dusit and Frasers Property 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 Frasers Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bangkok Dusit and Frasers Property.
Diversification Opportunities for Bangkok Dusit and Frasers Property
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Bangkok and Frasers is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Bangkok Dusit Medical and Frasers Property Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frasers Property 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 Frasers Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frasers Property Public has no effect on the direction of Bangkok Dusit i.e., Bangkok Dusit and Frasers Property go up and down completely randomly.
Pair Corralation between Bangkok Dusit and Frasers Property
Assuming the 90 days trading horizon Bangkok Dusit Medical is expected to generate 0.9 times more return on investment than Frasers Property. However, Bangkok Dusit Medical is 1.12 times less risky than Frasers Property. It trades about 0.01 of its potential returns per unit of risk. Frasers Property Public is currently generating about -0.05 per unit of risk. If you would invest 2,513 in Bangkok Dusit Medical on September 2, 2024 and sell it today you would earn a total of 12.00 from holding Bangkok Dusit Medical or generate 0.48% 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. Frasers Property Public
Performance |
| Timeline |
| Bangkok Dusit Medical |
| Frasers Property Public |
Bangkok Dusit and Frasers Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bangkok Dusit and Frasers Property
The main advantage of trading using opposite Bangkok Dusit and Frasers Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bangkok Dusit position performs unexpectedly, Frasers Property 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 Frasers Property will offset losses from the drop in Frasers Property's long position.| Bangkok Dusit vs. AP Public | Bangkok Dusit vs. Advanced Information Technology | Bangkok Dusit vs. AJ Plast Public | Bangkok Dusit vs. Berli Jucker 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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