Correlation Between Dynasty Ceramic and Ichitan Group
Can any of the company-specific risk be diversified away by investing in both Dynasty Ceramic and Ichitan Group 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 Dynasty Ceramic and Ichitan Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dynasty Ceramic Public and Ichitan Group Public, you can compare the effects of market volatilities on Dynasty Ceramic and Ichitan Group 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 Dynasty Ceramic with a short position of Ichitan Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dynasty Ceramic and Ichitan Group.
Diversification Opportunities for Dynasty Ceramic and Ichitan Group
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dynasty and Ichitan is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Dynasty Ceramic Public and Ichitan Group Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ichitan Group Public and Dynasty Ceramic 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 Dynasty Ceramic Public are associated (or correlated) with Ichitan Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ichitan Group Public has no effect on the direction of Dynasty Ceramic i.e., Dynasty Ceramic and Ichitan Group go up and down completely randomly.
Pair Corralation between Dynasty Ceramic and Ichitan Group
Assuming the 90 days trading horizon Dynasty Ceramic Public is expected to under-perform the Ichitan Group. But the stock apears to be less risky and, when comparing its historical volatility, Dynasty Ceramic Public is 1.22 times less risky than Ichitan Group. The stock trades about -0.46 of its potential returns per unit of risk. The Ichitan Group Public is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 1,480 in Ichitan Group Public on September 19, 2024 and sell it today you would lose (40.00) from holding Ichitan Group Public or give up 2.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dynasty Ceramic Public vs. Ichitan Group Public
Performance |
| Timeline |
| Dynasty Ceramic Public |
| Ichitan Group Public |
Dynasty Ceramic and Ichitan Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dynasty Ceramic and Ichitan Group
The main advantage of trading using opposite Dynasty Ceramic and Ichitan Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dynasty Ceramic position performs unexpectedly, Ichitan Group 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 Ichitan Group will offset losses from the drop in Ichitan Group's long position.| Dynasty Ceramic vs. Land and Houses | Dynasty Ceramic vs. AP Public | Dynasty Ceramic vs. Charoen Pokphand Foods | Dynasty Ceramic vs. Hana Microelectronics Public |
| Ichitan Group vs. GFPT Public | Ichitan Group vs. Dynasty Ceramic Public | Ichitan Group vs. Haad Thip Public | Ichitan Group vs. The Erawan 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 CEOs Directory module to screen CEOs from public companies around the world.
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