Correlation Between Chiangmai Frozen and GFPT Public
Can any of the company-specific risk be diversified away by investing in both Chiangmai Frozen and GFPT 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 GFPT 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 GFPT Public, you can compare the effects of market volatilities on Chiangmai Frozen and GFPT 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 GFPT Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chiangmai Frozen and GFPT Public.
Diversification Opportunities for Chiangmai Frozen and GFPT Public
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Chiangmai and GFPT is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Chiangmai Frozen Foods and GFPT Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GFPT 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 GFPT Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GFPT Public has no effect on the direction of Chiangmai Frozen i.e., Chiangmai Frozen and GFPT Public go up and down completely randomly.
Pair Corralation between Chiangmai Frozen and GFPT Public
Assuming the 90 days horizon Chiangmai Frozen Foods is expected to generate 0.85 times more return on investment than GFPT Public. However, Chiangmai Frozen Foods is 1.17 times less risky than GFPT Public. It trades about -0.12 of its potential returns per unit of risk. GFPT Public is currently generating about -0.16 per unit of risk. If you would invest 212.00 in Chiangmai Frozen Foods on September 13, 2024 and sell it today you would lose (12.00) from holding Chiangmai Frozen Foods or give up 5.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chiangmai Frozen Foods vs. GFPT Public
Performance |
| Timeline |
| Chiangmai Frozen Foods |
| GFPT Public |
Chiangmai Frozen and GFPT Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chiangmai Frozen and GFPT Public
The main advantage of trading using opposite Chiangmai Frozen and GFPT Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chiangmai Frozen position performs unexpectedly, GFPT 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 GFPT Public will offset losses from the drop in GFPT 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 |
| GFPT Public vs. Dynasty Ceramic Public | GFPT Public vs. Haad Thip Public | GFPT Public vs. The Erawan Group | GFPT Public vs. Jay Mart 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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