Correlation Between Ford and Kiattana Transport
Can any of the company-specific risk be diversified away by investing in both Ford and Kiattana Transport 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 Ford and Kiattana Transport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Kiattana Transport Public, you can compare the effects of market volatilities on Ford and Kiattana Transport 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 Ford with a short position of Kiattana Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Kiattana Transport.
Diversification Opportunities for Ford and Kiattana Transport
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ford and Kiattana is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Kiattana Transport Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kiattana Transport Public and Ford 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 Ford Motor are associated (or correlated) with Kiattana Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kiattana Transport Public has no effect on the direction of Ford i.e., Ford and Kiattana Transport go up and down completely randomly.
Pair Corralation between Ford and Kiattana Transport
Taking into account the 90-day investment horizon Ford Motor is expected to generate 0.9 times more return on investment than Kiattana Transport. However, Ford Motor is 1.11 times less risky than Kiattana Transport. It trades about 0.22 of its potential returns per unit of risk. Kiattana Transport Public is currently generating about -0.11 per unit of risk. If you would invest 1,022 in Ford Motor on September 3, 2024 and sell it today you would earn a total of 91.00 from holding Ford Motor or generate 8.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Ford Motor vs. Kiattana Transport Public
Performance |
| Timeline |
| Ford Motor |
| Kiattana Transport Public |
Ford and Kiattana Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Kiattana Transport
The main advantage of trading using opposite Ford and Kiattana Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Kiattana Transport 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 Kiattana Transport will offset losses from the drop in Kiattana Transport's long position.| Ford vs. GreenPower Motor | Ford vs. ZEEKR Intelligent Technology | Ford vs. Volcon Inc | Ford vs. Ford Motor |
| Kiattana Transport vs. Mono Next Public | Kiattana Transport vs. Triple i Logistics | Kiattana Transport vs. Dynasty Ceramic Public | Kiattana Transport vs. The Erawan Group |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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