Correlation Between Bangkok Bank and China Citic
Can any of the company-specific risk be diversified away by investing in both Bangkok Bank and China Citic 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 China Citic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bangkok Bank PCL and China Citic Bank, you can compare the effects of market volatilities on Bangkok Bank and China Citic 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 China Citic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bangkok Bank and China Citic.
Diversification Opportunities for Bangkok Bank and China Citic
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Bangkok and China is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Bangkok Bank PCL and China Citic Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Citic Bank 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 PCL are associated (or correlated) with China Citic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Citic Bank has no effect on the direction of Bangkok Bank i.e., Bangkok Bank and China Citic go up and down completely randomly.
Pair Corralation between Bangkok Bank and China Citic
Assuming the 90 days horizon Bangkok Bank is expected to generate 3.44 times less return on investment than China Citic. But when comparing it to its historical volatility, Bangkok Bank PCL is 1.11 times less risky than China Citic. It trades about 0.02 of its potential returns per unit of risk. China Citic Bank is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 682.00 in China Citic Bank on August 24, 2024 and sell it today you would earn a total of 713.00 from holding China Citic Bank or generate 104.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bangkok Bank PCL vs. China Citic Bank
Performance |
| Timeline |
| Bangkok Bank PCL |
| China Citic Bank |
Bangkok Bank and China Citic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bangkok Bank and China Citic
The main advantage of trading using opposite Bangkok Bank and China Citic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bangkok Bank position performs unexpectedly, China Citic 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 China Citic will offset losses from the drop in China Citic's long position.| Bangkok Bank vs. Partners Bank of | Bangkok Bank vs. BOC Hong Kong | Bangkok Bank vs. China Merchants Bank | Bangkok Bank vs. Bank of the |
| China Citic vs. Nedbank Group | China Citic vs. Standard Bank Group | China Citic vs. Bank Central Asia | China Citic vs. PSB Holdings |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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