Correlation Between Eastern Technical and Pico Public
Can any of the company-specific risk be diversified away by investing in both Eastern Technical and Pico Public 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 Eastern Technical and Pico Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eastern Technical Engineering and Pico Public, you can compare the effects of market volatilities on Eastern Technical and Pico Public 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 Eastern Technical with a short position of Pico Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastern Technical and Pico Public.
Diversification Opportunities for Eastern Technical and Pico Public
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Eastern and Pico is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Eastern Technical Engineering and Pico Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pico Public and Eastern Technical 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 Eastern Technical Engineering are associated (or correlated) with Pico Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pico Public has no effect on the direction of Eastern Technical i.e., Eastern Technical and Pico Public go up and down completely randomly.
Pair Corralation between Eastern Technical and Pico Public
Assuming the 90 days trading horizon Eastern Technical is expected to generate 1.02 times less return on investment than Pico Public. But when comparing it to its historical volatility, Eastern Technical Engineering is 1.0 times less risky than Pico Public. It trades about 0.06 of its potential returns per unit of risk. Pico Public is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 492.00 in Pico Public on August 25, 2024 and sell it today you would lose (134.00) from holding Pico Public or give up 27.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.45% |
| Values | Daily Returns |
Eastern Technical Engineering vs. Pico Public
Performance |
| Timeline |
| Eastern Technical |
| Pico Public |
Eastern Technical and Pico Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastern Technical and Pico Public
The main advantage of trading using opposite Eastern Technical and Pico Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastern Technical position performs unexpectedly, Pico Public 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 Pico Public will offset losses from the drop in Pico Public's long position.| Eastern Technical vs. Gunkul Engineering Public | Eastern Technical vs. The Erawan Group | Eastern Technical vs. Autocorp Holding Public | Eastern Technical vs. XSpring Capital Public |
| Pico Public vs. Prodigy Public | Pico Public vs. Panjawattana Plastic Public | Pico Public vs. Phol Dhanya Public | Pico Public vs. Moong Pattana International |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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