Correlation Between Com7 PCL and SCB X
Can any of the company-specific risk be diversified away by investing in both Com7 PCL and SCB X 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 SCB X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Com7 PCL and SCB X Public, you can compare the effects of market volatilities on Com7 PCL and SCB X 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 SCB X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Com7 PCL and SCB X.
Diversification Opportunities for Com7 PCL and SCB X
Poor diversification
The 3 months correlation between Com7 and SCB is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Com7 PCL and SCB X Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCB X 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 SCB X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCB X Public has no effect on the direction of Com7 PCL i.e., Com7 PCL and SCB X go up and down completely randomly.
Pair Corralation between Com7 PCL and SCB X
Assuming the 90 days trading horizon Com7 PCL is expected to generate 3.08 times less return on investment than SCB X. In addition to that, Com7 PCL is 2.14 times more volatile than SCB X Public. It trades about 0.01 of its total potential returns per unit of risk. SCB X Public is currently generating about 0.05 per unit of volatility. If you would invest 9,558 in SCB X Public on August 31, 2024 and sell it today you would earn a total of 1,892 from holding SCB X Public or generate 19.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Com7 PCL vs. SCB X Public
Performance |
| Timeline |
| Com7 PCL |
| SCB X Public |
Com7 PCL and SCB X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Com7 PCL and SCB X
The main advantage of trading using opposite Com7 PCL and SCB X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Com7 PCL position performs unexpectedly, SCB X 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 SCB X will offset losses from the drop in SCB X'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 |
| SCB X vs. Bangkok Dusit Medical | SCB X vs. Bank of Ayudhya | SCB X vs. KTBST Mixed Leasehold | SCB X vs. TISCO Financial Group |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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