Correlation Between Delta Electronics and KCE Electronics
Can any of the company-specific risk be diversified away by investing in both Delta Electronics and KCE Electronics 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 Delta Electronics and KCE Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delta Electronics Public and KCE Electronics Public, you can compare the effects of market volatilities on Delta Electronics and KCE Electronics 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 Delta Electronics with a short position of KCE Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delta Electronics and KCE Electronics.
Diversification Opportunities for Delta Electronics and KCE Electronics
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Delta and KCE is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Delta Electronics Public and KCE Electronics Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KCE Electronics Public and Delta Electronics 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 Delta Electronics Public are associated (or correlated) with KCE Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KCE Electronics Public has no effect on the direction of Delta Electronics i.e., Delta Electronics and KCE Electronics go up and down completely randomly.
Pair Corralation between Delta Electronics and KCE Electronics
Assuming the 90 days trading horizon Delta Electronics Public is expected to generate 1.42 times more return on investment than KCE Electronics. However, Delta Electronics is 1.42 times more volatile than KCE Electronics Public. It trades about 0.06 of its potential returns per unit of risk. KCE Electronics Public is currently generating about -0.04 per unit of risk. If you would invest 7,320 in Delta Electronics Public on August 24, 2024 and sell it today you would earn a total of 7,280 from holding Delta Electronics Public or generate 99.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delta Electronics Public vs. KCE Electronics Public
Performance |
| Timeline |
| Delta Electronics Public |
| KCE Electronics Public |
Delta Electronics and KCE Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delta Electronics and KCE Electronics
The main advantage of trading using opposite Delta Electronics and KCE Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delta Electronics position performs unexpectedly, KCE Electronics 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 KCE Electronics will offset losses from the drop in KCE Electronics' long position.| Delta Electronics vs. AP Public | Delta Electronics vs. Jasmine International Public | Delta Electronics vs. Asia Plus Group | Delta Electronics vs. Bangkok Aviation Fuel |
| KCE Electronics vs. AP Public | KCE Electronics vs. Jasmine International Public | KCE Electronics vs. Asia Plus Group | KCE Electronics vs. Bangkok Aviation Fuel |
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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