Correlation Between Bangkok Bank and MAG SILVER
Can any of the company-specific risk be diversified away by investing in both Bangkok Bank and MAG SILVER 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 Bank and MAG SILVER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bangkok Bank Public and MAG SILVER, you can compare the effects of market volatilities on Bangkok Bank and MAG SILVER 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 Bank with a short position of MAG SILVER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bangkok Bank and MAG SILVER.
Diversification Opportunities for Bangkok Bank and MAG SILVER
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bangkok and MAG is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Bangkok Bank Public and MAG SILVER in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MAG SILVER and Bangkok Bank 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 Bank Public are associated (or correlated) with MAG SILVER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MAG SILVER has no effect on the direction of Bangkok Bank i.e., Bangkok Bank and MAG SILVER go up and down completely randomly.
Pair Corralation between Bangkok Bank and MAG SILVER
Assuming the 90 days trading horizon Bangkok Bank Public is expected to generate 2.62 times more return on investment than MAG SILVER. However, Bangkok Bank is 2.62 times more volatile than MAG SILVER. It trades about 0.06 of its potential returns per unit of risk. MAG SILVER is currently generating about 0.03 per unit of risk. If you would invest 105.00 in Bangkok Bank Public on November 2, 2024 and sell it today you would earn a total of 329.00 from holding Bangkok Bank Public or generate 313.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bangkok Bank Public vs. MAG SILVER
Performance |
| Timeline |
| Bangkok Bank Public |
| MAG SILVER |
Bangkok Bank and MAG SILVER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bangkok Bank and MAG SILVER
The main advantage of trading using opposite Bangkok Bank and MAG SILVER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bangkok Bank position performs unexpectedly, MAG SILVER 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 MAG SILVER will offset losses from the drop in MAG SILVER's long position.| Bangkok Bank vs. Cairo Communication SpA | Bangkok Bank vs. Verizon Communications | Bangkok Bank vs. Cass Information Systems | Bangkok Bank vs. Entravision Communications |
| MAG SILVER vs. SIVERS SEMICONDUCTORS AB | MAG SILVER vs. NorAm Drilling AS | MAG SILVER vs. Volkswagen AG | MAG SILVER vs. Darden Restaurants |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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