Correlation Between Chiangmai Frozen and AP Public
Can any of the company-specific risk be diversified away by investing in both Chiangmai Frozen and AP Public 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 Chiangmai Frozen and AP Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chiangmai Frozen Foods and AP Public, you can compare the effects of market volatilities on Chiangmai Frozen and AP Public 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 Chiangmai Frozen with a short position of AP Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chiangmai Frozen and AP Public.
Diversification Opportunities for Chiangmai Frozen and AP Public
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Chiangmai and AP Public is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Chiangmai Frozen Foods and AP Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AP Public and Chiangmai Frozen 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 Chiangmai Frozen Foods are associated (or correlated) with AP Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AP Public has no effect on the direction of Chiangmai Frozen i.e., Chiangmai Frozen and AP Public go up and down completely randomly.
Pair Corralation between Chiangmai Frozen and AP Public
Assuming the 90 days horizon Chiangmai Frozen Foods is expected to generate 33.45 times more return on investment than AP Public. However, Chiangmai Frozen is 33.45 times more volatile than AP Public. It trades about 0.05 of its potential returns per unit of risk. AP Public is currently generating about -0.03 per unit of risk. If you would invest 202.00 in Chiangmai Frozen Foods on August 31, 2024 and sell it today you would earn a total of 0.00 from holding Chiangmai Frozen Foods or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
Chiangmai Frozen Foods vs. AP Public
Performance |
| Timeline |
| Chiangmai Frozen Foods |
| AP Public |
Chiangmai Frozen and AP Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chiangmai Frozen and AP Public
The main advantage of trading using opposite Chiangmai Frozen and AP Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chiangmai Frozen position performs unexpectedly, AP Public 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 AP Public will offset losses from the drop in AP Public's long position.| Chiangmai Frozen vs. Chumporn Palm Oil | Chiangmai Frozen vs. GFPT Public | Chiangmai Frozen vs. Crown Seal Public | Chiangmai Frozen vs. Dynasty Ceramic Public |
| AP Public vs. Land and Houses | AP Public vs. Bangkok Bank Public | AP Public vs. Siri Prime Office | AP Public vs. Charoen Pokphand Foods |
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 Correlations module to find global opportunities by holding instruments from different markets.
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