Correlation Between Chiangmai Frozen and CP ALL
Can any of the company-specific risk be diversified away by investing in both Chiangmai Frozen and CP ALL 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 CP ALL 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 CP ALL Public, you can compare the effects of market volatilities on Chiangmai Frozen and CP ALL 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 CP ALL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chiangmai Frozen and CP ALL.
Diversification Opportunities for Chiangmai Frozen and CP ALL
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Chiangmai and CPALL is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Chiangmai Frozen Foods and CP ALL Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CP ALL 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 CP ALL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CP ALL Public has no effect on the direction of Chiangmai Frozen i.e., Chiangmai Frozen and CP ALL go up and down completely randomly.
Pair Corralation between Chiangmai Frozen and CP ALL
Assuming the 90 days horizon Chiangmai Frozen Foods is expected to under-perform the CP ALL. In addition to that, Chiangmai Frozen is 1.07 times more volatile than CP ALL Public. It trades about -0.16 of its total potential returns per unit of risk. CP ALL Public is currently generating about -0.07 per unit of volatility. If you would invest 6,575 in CP ALL Public on August 25, 2024 and sell it today you would lose (250.00) from holding CP ALL Public or give up 3.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chiangmai Frozen Foods vs. CP ALL Public
Performance |
| Timeline |
| Chiangmai Frozen Foods |
| CP ALL Public |
Chiangmai Frozen and CP ALL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chiangmai Frozen and CP ALL
The main advantage of trading using opposite Chiangmai Frozen and CP ALL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chiangmai Frozen position performs unexpectedly, CP ALL 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 CP ALL will offset losses from the drop in CP ALL's long position.| Chiangmai Frozen vs. CP ALL Public | Chiangmai Frozen vs. Thai Union Group | Chiangmai Frozen vs. Minor International Public | Chiangmai Frozen vs. Central Pattana Public |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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