Correlation Between Com7 PCL and Energy Absolute
Can any of the company-specific risk be diversified away by investing in both Com7 PCL and Energy Absolute 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 Com7 PCL and Energy Absolute into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Com7 PCL and Energy Absolute Public, you can compare the effects of market volatilities on Com7 PCL and Energy Absolute 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 Com7 PCL with a short position of Energy Absolute. Check out your portfolio center. Please also check ongoing floating volatility patterns of Com7 PCL and Energy Absolute.
Diversification Opportunities for Com7 PCL and Energy Absolute
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Com7 and Energy is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Com7 PCL and Energy Absolute Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energy Absolute Public and Com7 PCL 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 Com7 PCL are associated (or correlated) with Energy Absolute. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energy Absolute Public has no effect on the direction of Com7 PCL i.e., Com7 PCL and Energy Absolute go up and down completely randomly.
Pair Corralation between Com7 PCL and Energy Absolute
Assuming the 90 days trading horizon Com7 PCL is expected to generate 0.48 times more return on investment than Energy Absolute. However, Com7 PCL is 2.09 times less risky than Energy Absolute. It trades about -0.08 of its potential returns per unit of risk. Energy Absolute Public is currently generating about -0.16 per unit of risk. If you would invest 2,800 in Com7 PCL on September 1, 2024 and sell it today you would lose (150.00) from holding Com7 PCL or give up 5.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Com7 PCL vs. Energy Absolute Public
Performance |
| Timeline |
| Com7 PCL |
| Energy Absolute Public |
Com7 PCL and Energy Absolute Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Com7 PCL and Energy Absolute
The main advantage of trading using opposite Com7 PCL and Energy Absolute positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Com7 PCL position performs unexpectedly, Energy Absolute 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 Energy Absolute will offset losses from the drop in Energy Absolute's long position.| Com7 PCL vs. TRC Construction Public | Com7 PCL vs. Bangkok Expressway and | Com7 PCL vs. Lohakit Metal Public | Com7 PCL vs. Gunkul Engineering Public |
| Energy Absolute vs. Gulf Energy Development | Energy Absolute vs. Global Power Synergy | Energy Absolute vs. CP ALL Public | Energy Absolute vs. Bangkok Dusit Medical |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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