Correlation Between CK Power and Asia Aviation
Can any of the company-specific risk be diversified away by investing in both CK Power and Asia Aviation 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 CK Power and Asia Aviation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CK Power Public and Asia Aviation Public, you can compare the effects of market volatilities on CK Power and Asia Aviation 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 CK Power with a short position of Asia Aviation. Check out your portfolio center. Please also check ongoing floating volatility patterns of CK Power and Asia Aviation.
Diversification Opportunities for CK Power and Asia Aviation
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CKP and Asia is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding CK Power Public and Asia Aviation Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Aviation Public and CK Power 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 CK Power Public are associated (or correlated) with Asia Aviation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Aviation Public has no effect on the direction of CK Power i.e., CK Power and Asia Aviation go up and down completely randomly.
Pair Corralation between CK Power and Asia Aviation
Assuming the 90 days trading horizon CK Power Public is expected to under-perform the Asia Aviation. In addition to that, CK Power is 1.04 times more volatile than Asia Aviation Public. It trades about -0.18 of its total potential returns per unit of risk. Asia Aviation Public is currently generating about -0.09 per unit of volatility. If you would invest 290.00 in Asia Aviation Public on August 29, 2024 and sell it today you would lose (10.00) from holding Asia Aviation Public or give up 3.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CK Power Public vs. Asia Aviation Public
Performance |
| Timeline |
| CK Power Public |
| Asia Aviation Public |
CK Power and Asia Aviation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CK Power and Asia Aviation
The main advantage of trading using opposite CK Power and Asia Aviation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CK Power position performs unexpectedly, Asia Aviation 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 Asia Aviation will offset losses from the drop in Asia Aviation's long position.| CK Power vs. Energy Absolute Public | CK Power vs. BCPG Public | CK Power vs. Bangkok Expressway and | CK Power vs. Gulf Energy Development |
| Asia Aviation vs. MCS Steel Public | Asia Aviation vs. Asia Plus Group | Asia Aviation vs. Lalin Property Public | Asia Aviation vs. Lam Soon 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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