Correlation Between CH Karnchang and AAPICO Hitech
Can any of the company-specific risk be diversified away by investing in both CH Karnchang and AAPICO Hitech 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 CH Karnchang and AAPICO Hitech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CH Karnchang Public and AAPICO Hitech Public, you can compare the effects of market volatilities on CH Karnchang and AAPICO Hitech 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 CH Karnchang with a short position of AAPICO Hitech. Check out your portfolio center. Please also check ongoing floating volatility patterns of CH Karnchang and AAPICO Hitech.
Diversification Opportunities for CH Karnchang and AAPICO Hitech
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CH Karnchang and AAPICO is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding CH Karnchang Public and AAPICO Hitech Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AAPICO Hitech Public and CH Karnchang 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 CH Karnchang Public are associated (or correlated) with AAPICO Hitech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AAPICO Hitech Public has no effect on the direction of CH Karnchang i.e., CH Karnchang and AAPICO Hitech go up and down completely randomly.
Pair Corralation between CH Karnchang and AAPICO Hitech
Assuming the 90 days horizon CH Karnchang Public is expected to under-perform the AAPICO Hitech. But the stock apears to be less risky and, when comparing its historical volatility, CH Karnchang Public is 1.25 times less risky than AAPICO Hitech. The stock trades about -0.04 of its potential returns per unit of risk. The AAPICO Hitech Public is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 1,569 in AAPICO Hitech Public on October 25, 2024 and sell it today you would lose (149.00) from holding AAPICO Hitech Public or give up 9.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CH Karnchang Public vs. AAPICO Hitech Public
Performance |
| Timeline |
| CH Karnchang Public |
| AAPICO Hitech Public |
CH Karnchang and AAPICO Hitech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CH Karnchang and AAPICO Hitech
The main advantage of trading using opposite CH Karnchang and AAPICO Hitech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CH Karnchang position performs unexpectedly, AAPICO Hitech 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 AAPICO Hitech will offset losses from the drop in AAPICO Hitech's long position.| CH Karnchang vs. Italian Thai Development Public | CH Karnchang vs. Charoen Pokphand Foods | CH Karnchang vs. Land and Houses | CH Karnchang vs. Bangkok Bank Public |
| AAPICO Hitech vs. Porn Prom Metal | AAPICO Hitech vs. Lohakit Metal Public | AAPICO Hitech vs. Bhiraj Office Leasehold | AAPICO Hitech vs. Fine Metal Technologies |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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