Correlation Between Bangkok Expressway and Sawang Export
Can any of the company-specific risk be diversified away by investing in both Bangkok Expressway and Sawang Export 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 Expressway and Sawang Export into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bangkok Expressway and and Sawang Export Public, you can compare the effects of market volatilities on Bangkok Expressway and Sawang Export 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 Expressway with a short position of Sawang Export. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bangkok Expressway and Sawang Export.
Diversification Opportunities for Bangkok Expressway and Sawang Export
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Bangkok and Sawang is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Bangkok Expressway and and Sawang Export Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sawang Export Public and Bangkok Expressway 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 Expressway and are associated (or correlated) with Sawang Export. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sawang Export Public has no effect on the direction of Bangkok Expressway i.e., Bangkok Expressway and Sawang Export go up and down completely randomly.
Pair Corralation between Bangkok Expressway and Sawang Export
Assuming the 90 days trading horizon Bangkok Expressway and is expected to under-perform the Sawang Export. But the stock apears to be less risky and, when comparing its historical volatility, Bangkok Expressway and is 3.0 times less risky than Sawang Export. The stock trades about -0.44 of its potential returns per unit of risk. The Sawang Export Public is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 1,240 in Sawang Export Public on September 3, 2024 and sell it today you would lose (20.00) from holding Sawang Export Public or give up 1.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bangkok Expressway and vs. Sawang Export Public
Performance |
| Timeline |
| Bangkok Expressway and |
| Sawang Export Public |
Bangkok Expressway and Sawang Export Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bangkok Expressway and Sawang Export
The main advantage of trading using opposite Bangkok Expressway and Sawang Export positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bangkok Expressway position performs unexpectedly, Sawang Export 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 Sawang Export will offset losses from the drop in Sawang Export's long position.| Bangkok Expressway vs. BTS Group Holdings | Bangkok Expressway vs. Bangkok Dusit Medical | Bangkok Expressway vs. Airports of Thailand | Bangkok Expressway vs. CP ALL Public |
| Sawang Export vs. Sabina Public | Sawang Export vs. Rockworth Public | Sawang Export vs. Thaitheparos Public | Sawang Export vs. Sappe 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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