Correlation Between Ford and Ladprao General
Can any of the company-specific risk be diversified away by investing in both Ford and Ladprao General 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 Ladprao General into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Ladprao General Hospital, you can compare the effects of market volatilities on Ford and Ladprao General 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 Ladprao General. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Ladprao General.
Diversification Opportunities for Ford and Ladprao General
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ford and Ladprao is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Ladprao General Hospital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ladprao General Hospital 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 Ladprao General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ladprao General Hospital has no effect on the direction of Ford i.e., Ford and Ladprao General go up and down completely randomly.
Pair Corralation between Ford and Ladprao General
Taking into account the 90-day investment horizon Ford Motor is expected to generate 3.93 times more return on investment than Ladprao General. However, Ford is 3.93 times more volatile than Ladprao General Hospital. It trades about 0.0 of its potential returns per unit of risk. Ladprao General Hospital is currently generating about -0.09 per unit of risk. If you would invest 1,169 in Ford Motor on September 2, 2024 and sell it today you would lose (56.00) from holding Ford Motor or give up 4.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Ford Motor vs. Ladprao General Hospital
Performance |
| Timeline |
| Ford Motor |
| Ladprao General Hospital |
Ford and Ladprao General Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Ladprao General
The main advantage of trading using opposite Ford and Ladprao General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Ladprao General 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 Ladprao General will offset losses from the drop in Ladprao General's long position.The idea behind Ford Motor and Ladprao General Hospital pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Ladprao General vs. Ekachai Medical Care | Ladprao General vs. Bangkok Chain Hospital | Ladprao General vs. Rajthanee Hospital Public | Ladprao General vs. Chularat 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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