Correlation Between Bangkok Dusit and Interlink Telecom
Can any of the company-specific risk be diversified away by investing in both Bangkok Dusit and Interlink Telecom 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 Interlink Telecom 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 Interlink Telecom Public, you can compare the effects of market volatilities on Bangkok Dusit and Interlink Telecom 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 Interlink Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bangkok Dusit and Interlink Telecom.
Diversification Opportunities for Bangkok Dusit and Interlink Telecom
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bangkok and Interlink is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Bangkok Dusit Medical and Interlink Telecom Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Interlink Telecom 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 Interlink Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Interlink Telecom Public has no effect on the direction of Bangkok Dusit i.e., Bangkok Dusit and Interlink Telecom go up and down completely randomly.
Pair Corralation between Bangkok Dusit and Interlink Telecom
Assuming the 90 days trading horizon Bangkok Dusit Medical is expected to generate 0.49 times more return on investment than Interlink Telecom. However, Bangkok Dusit Medical is 2.04 times less risky than Interlink Telecom. It trades about 0.0 of its potential returns per unit of risk. Interlink Telecom Public is currently generating about -0.03 per unit of risk. If you would invest 2,671 in Bangkok Dusit Medical on September 2, 2024 and sell it today you would lose (146.00) from holding Bangkok Dusit Medical or give up 5.47% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bangkok Dusit Medical vs. Interlink Telecom Public
Performance |
| Timeline |
| Bangkok Dusit Medical |
| Interlink Telecom Public |
Bangkok Dusit and Interlink Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bangkok Dusit and Interlink Telecom
The main advantage of trading using opposite Bangkok Dusit and Interlink Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bangkok Dusit position performs unexpectedly, Interlink Telecom 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 Interlink Telecom will offset losses from the drop in Interlink Telecom'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 |
| Interlink Telecom vs. Hana Microelectronics Public | Interlink Telecom vs. Ekachai Medical Care | Interlink Telecom vs. Megachem Public | Interlink Telecom vs. Diamond Building Products |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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