Correlation Between Christiani Nielsen and Chonburi Concrete
Can any of the company-specific risk be diversified away by investing in both Christiani Nielsen and Chonburi Concrete 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 Christiani Nielsen and Chonburi Concrete into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Christiani Nielsen Public and Chonburi Concrete Product, you can compare the effects of market volatilities on Christiani Nielsen and Chonburi Concrete 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 Christiani Nielsen with a short position of Chonburi Concrete. Check out your portfolio center. Please also check ongoing floating volatility patterns of Christiani Nielsen and Chonburi Concrete.
Diversification Opportunities for Christiani Nielsen and Chonburi Concrete
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Christiani and Chonburi is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Christiani Nielsen Public and Chonburi Concrete Product in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chonburi Concrete Product and Christiani Nielsen 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 Christiani Nielsen Public are associated (or correlated) with Chonburi Concrete. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chonburi Concrete Product has no effect on the direction of Christiani Nielsen i.e., Christiani Nielsen and Chonburi Concrete go up and down completely randomly.
Pair Corralation between Christiani Nielsen and Chonburi Concrete
Assuming the 90 days trading horizon Christiani Nielsen Public is expected to under-perform the Chonburi Concrete. But the stock apears to be less risky and, when comparing its historical volatility, Christiani Nielsen Public is 1.01 times less risky than Chonburi Concrete. The stock trades about -0.32 of its potential returns per unit of risk. The Chonburi Concrete Product is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 30.00 in Chonburi Concrete Product on August 29, 2024 and sell it today you would lose (1.00) from holding Chonburi Concrete Product or give up 3.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Christiani Nielsen Public vs. Chonburi Concrete Product
Performance |
| Timeline |
| Christiani Nielsen Public |
| Chonburi Concrete Product |
Christiani Nielsen and Chonburi Concrete Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Christiani Nielsen and Chonburi Concrete
The main advantage of trading using opposite Christiani Nielsen and Chonburi Concrete positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Christiani Nielsen position performs unexpectedly, Chonburi Concrete 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 Chonburi Concrete will offset losses from the drop in Chonburi Concrete's long position.| Christiani Nielsen vs. CH Karnchang Public | Christiani Nielsen vs. Italian Thai Development Public | Christiani Nielsen vs. EMC Public | Christiani Nielsen vs. AAPICO Hitech 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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