Correlation Between Business Online and Salee Colour
Can any of the company-specific risk be diversified away by investing in both Business Online and Salee Colour 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 Business Online and Salee Colour into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Business Online PCL and Salee Colour Public, you can compare the effects of market volatilities on Business Online and Salee Colour 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 Business Online with a short position of Salee Colour. Check out your portfolio center. Please also check ongoing floating volatility patterns of Business Online and Salee Colour.
Diversification Opportunities for Business Online and Salee Colour
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Business and Salee is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Business Online PCL and Salee Colour Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Salee Colour Public and Business Online 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 Business Online PCL are associated (or correlated) with Salee Colour. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Salee Colour Public has no effect on the direction of Business Online i.e., Business Online and Salee Colour go up and down completely randomly.
Pair Corralation between Business Online and Salee Colour
Assuming the 90 days trading horizon Business Online PCL is expected to under-perform the Salee Colour. But the stock apears to be less risky and, when comparing its historical volatility, Business Online PCL is 31.93 times less risky than Salee Colour. The stock trades about -0.09 of its potential returns per unit of risk. The Salee Colour Public is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 154.00 in Salee Colour Public on September 2, 2024 and sell it today you would lose (42.00) from holding Salee Colour Public or give up 27.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Business Online PCL vs. Salee Colour Public
Performance |
| Timeline |
| Business Online PCL |
| Salee Colour Public |
Business Online and Salee Colour Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Business Online and Salee Colour
The main advantage of trading using opposite Business Online and Salee Colour positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Business Online position performs unexpectedly, Salee Colour 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 Salee Colour will offset losses from the drop in Salee Colour's long position.| Business Online vs. Premier Technology Public | Business Online vs. Sea Oil Public | Business Online vs. Thai Mitsuwa Public | Business Online vs. The Erawan Group |
| Salee Colour vs. CPR Gomu Industrial | Salee Colour vs. BuilderSmart Public | Salee Colour vs. Getabec Public | Salee Colour vs. BGT 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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |