Correlation Between Electricity Generating and Frasers Property
Can any of the company-specific risk be diversified away by investing in both Electricity Generating and Frasers Property 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 Electricity Generating and Frasers Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electricity Generating Public and Frasers Property Public, you can compare the effects of market volatilities on Electricity Generating and Frasers Property 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 Electricity Generating with a short position of Frasers Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electricity Generating and Frasers Property.
Diversification Opportunities for Electricity Generating and Frasers Property
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Electricity and Frasers is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Electricity Generating Public and Frasers Property Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frasers Property Public and Electricity Generating 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 Electricity Generating Public are associated (or correlated) with Frasers Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frasers Property Public has no effect on the direction of Electricity Generating i.e., Electricity Generating and Frasers Property go up and down completely randomly.
Pair Corralation between Electricity Generating and Frasers Property
Assuming the 90 days trading horizon Electricity Generating Public is expected to under-perform the Frasers Property. In addition to that, Electricity Generating is 1.16 times more volatile than Frasers Property Public. It trades about -0.04 of its total potential returns per unit of risk. Frasers Property Public is currently generating about -0.02 per unit of volatility. If you would invest 1,446 in Frasers Property Public on August 31, 2024 and sell it today you would lose (226.00) from holding Frasers Property Public or give up 15.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.78% |
| Values | Daily Returns |
Electricity Generating Public vs. Frasers Property Public
Performance |
| Timeline |
| Electricity Generating |
| Frasers Property Public |
Electricity Generating and Frasers Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electricity Generating and Frasers Property
The main advantage of trading using opposite Electricity Generating and Frasers Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electricity Generating position performs unexpectedly, Frasers Property 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 Frasers Property will offset losses from the drop in Frasers Property's long position.| Electricity Generating vs. PTT Public | Electricity Generating vs. The Siam Cement | Electricity Generating vs. Ratch Group Public | Electricity Generating vs. Bangkok Bank Public |
| Frasers Property vs. AP Public | Frasers Property vs. Electricity Generating Public | Frasers Property vs. Com7 PCL | Frasers Property vs. Bangkok Dusit Medical |
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 Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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