Correlation Between Ekachai Medical and Thonburi Medical
Can any of the company-specific risk be diversified away by investing in both Ekachai Medical and Thonburi 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 Ekachai Medical and Thonburi Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ekachai Medical Care and Thonburi Medical Centre, you can compare the effects of market volatilities on Ekachai Medical and Thonburi 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 Ekachai Medical with a short position of Thonburi Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ekachai Medical and Thonburi Medical.
Diversification Opportunities for Ekachai Medical and Thonburi Medical
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ekachai and Thonburi is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Ekachai Medical Care and Thonburi Medical Centre in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thonburi Medical Centre and Ekachai Medical 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 Ekachai Medical Care are associated (or correlated) with Thonburi Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thonburi Medical Centre has no effect on the direction of Ekachai Medical i.e., Ekachai Medical and Thonburi Medical go up and down completely randomly.
Pair Corralation between Ekachai Medical and Thonburi Medical
Assuming the 90 days trading horizon Ekachai Medical Care is expected to under-perform the Thonburi Medical. But the stock apears to be less risky and, when comparing its historical volatility, Ekachai Medical Care is 45.66 times less risky than Thonburi Medical. The stock trades about -0.01 of its potential returns per unit of risk. The Thonburi Medical Centre is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 9,760 in Thonburi Medical Centre on August 29, 2024 and sell it today you would lose (60.00) from holding Thonburi Medical Centre or give up 0.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ekachai Medical Care vs. Thonburi Medical Centre
Performance |
| Timeline |
| Ekachai Medical Care |
| Thonburi Medical Centre |
Ekachai Medical and Thonburi Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ekachai Medical and Thonburi Medical
The main advantage of trading using opposite Ekachai Medical and Thonburi Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ekachai Medical position performs unexpectedly, Thonburi 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 Thonburi Medical will offset losses from the drop in Thonburi Medical's long position.| Ekachai Medical vs. Chularat Hospital Public | Ekachai Medical vs. Bangkok Chain Hospital | Ekachai Medical vs. Bangkok Dusit Medical | Ekachai Medical vs. Rajthanee Hospital Public |
| Thonburi Medical vs. Aikchol Hospital Public | Thonburi Medical vs. Nonthavej Hospital Public | Thonburi Medical vs. Wattana Karnpaet Public | Thonburi Medical vs. Mahachai Hospital 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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