Correlation Between Delta Electronics and Namwiwat Medical
Can any of the company-specific risk be diversified away by investing in both Delta Electronics and Namwiwat Medical 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 Namwiwat Medical 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 Namwiwat Medical, you can compare the effects of market volatilities on Delta Electronics and Namwiwat Medical 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 Namwiwat Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delta Electronics and Namwiwat Medical.
Diversification Opportunities for Delta Electronics and Namwiwat Medical
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Delta and Namwiwat is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Delta Electronics Public and Namwiwat Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Namwiwat Medical 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 Namwiwat Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Namwiwat Medical has no effect on the direction of Delta Electronics i.e., Delta Electronics and Namwiwat Medical go up and down completely randomly.
Pair Corralation between Delta Electronics and Namwiwat Medical
Assuming the 90 days trading horizon Delta Electronics Public is expected to generate 3.42 times more return on investment than Namwiwat Medical. However, Delta Electronics is 3.42 times more volatile than Namwiwat Medical. It trades about 0.25 of its potential returns per unit of risk. Namwiwat Medical is currently generating about -0.14 per unit of risk. If you would invest 10,700 in Delta Electronics Public on August 29, 2024 and sell it today you would earn a total of 4,450 from holding Delta Electronics Public or generate 41.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delta Electronics Public vs. Namwiwat Medical
Performance |
| Timeline |
| Delta Electronics Public |
| Namwiwat Medical |
Delta Electronics and Namwiwat Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delta Electronics and Namwiwat Medical
The main advantage of trading using opposite Delta Electronics and Namwiwat Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delta Electronics position performs unexpectedly, Namwiwat Medical 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 Namwiwat Medical will offset losses from the drop in Namwiwat Medical's long position.| Delta Electronics vs. Airports of Thailand | Delta Electronics vs. Hana Microelectronics Public | Delta Electronics vs. Advanced Info Service | Delta Electronics vs. Kasikornbank Public |
| Namwiwat Medical vs. Delta Electronics Public | Namwiwat Medical vs. Delta Electronics Public | Namwiwat Medical vs. Airports of Thailand | Namwiwat Medical vs. Airports of Thailand |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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