Correlation Between Central Pattana and AP Public
Can any of the company-specific risk be diversified away by investing in both Central Pattana and AP 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 Central Pattana and AP Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Central Pattana Public and AP Public, you can compare the effects of market volatilities on Central Pattana and AP 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 Central Pattana with a short position of AP Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Central Pattana and AP Public.
Diversification Opportunities for Central Pattana and AP Public
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Central and AP Public is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Central Pattana Public and AP Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AP Public and Central Pattana 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 Central Pattana Public are associated (or correlated) with AP Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AP Public has no effect on the direction of Central Pattana i.e., Central Pattana and AP Public go up and down completely randomly.
Pair Corralation between Central Pattana and AP Public
Assuming the 90 days trading horizon Central Pattana Public is expected to under-perform the AP Public. In addition to that, Central Pattana is 1.18 times more volatile than AP Public. It trades about -0.16 of its total potential returns per unit of risk. AP Public is currently generating about -0.13 per unit of volatility. If you would invest 830.00 in AP Public on November 3, 2024 and sell it today you would lose (35.00) from holding AP Public or give up 4.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Central Pattana Public vs. AP Public
Performance |
| Timeline |
| Central Pattana Public |
| AP Public |
Central Pattana and AP Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Central Pattana and AP Public
The main advantage of trading using opposite Central Pattana and AP Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Central Pattana position performs unexpectedly, AP 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 AP Public will offset losses from the drop in AP Public's long position.| Central Pattana vs. CP ALL Public | Central Pattana vs. Bangkok Dusit Medical | Central Pattana vs. Airports of Thailand | Central Pattana vs. Advanced Info Service |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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