Correlation Between CENTRAL RETAIL and Information
Can any of the company-specific risk be diversified away by investing in both CENTRAL RETAIL and Information 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 RETAIL and Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CENTRAL RETAIL P and Information and Communication, you can compare the effects of market volatilities on CENTRAL RETAIL and Information 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 RETAIL with a short position of Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of CENTRAL RETAIL and Information.
Diversification Opportunities for CENTRAL RETAIL and Information
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between CENTRAL and Information is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding CENTRAL RETAIL P and Information and Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Information and Comm and CENTRAL RETAIL 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 RETAIL P are associated (or correlated) with Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Information and Comm has no effect on the direction of CENTRAL RETAIL i.e., CENTRAL RETAIL and Information go up and down completely randomly.
Pair Corralation between CENTRAL RETAIL and Information
Assuming the 90 days trading horizon CENTRAL RETAIL P is expected to generate 0.41 times more return on investment than Information. However, CENTRAL RETAIL P is 2.44 times less risky than Information. It trades about -0.06 of its potential returns per unit of risk. Information and Communication is currently generating about -0.03 per unit of risk. If you would invest 4,265 in CENTRAL RETAIL P on September 3, 2024 and sell it today you would lose (915.00) from holding CENTRAL RETAIL P or give up 21.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CENTRAL RETAIL P vs. Information and Communication
Performance |
| Timeline |
| CENTRAL RETAIL P |
| Information and Comm |
CENTRAL RETAIL and Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CENTRAL RETAIL and Information
The main advantage of trading using opposite CENTRAL RETAIL and Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CENTRAL RETAIL position performs unexpectedly, Information 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 Information will offset losses from the drop in Information's long position.| CENTRAL RETAIL vs. Central Retail | CENTRAL RETAIL vs. The Erawan Group | CENTRAL RETAIL vs. Autocorp Holding Public | CENTRAL RETAIL vs. XSpring Capital Public |
| Information vs. Hana Microelectronics Public | Information vs. Ekachai Medical Care | Information vs. Megachem Public | Information vs. Intouch Holdings 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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