Correlation Between First State and Bangkok Bank
Can any of the company-specific risk be diversified away by investing in both First State and Bangkok Bank 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 First State and Bangkok Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First State Financial and Bangkok Bank Public, you can compare the effects of market volatilities on First State and Bangkok Bank 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 First State with a short position of Bangkok Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of First State and Bangkok Bank.
Diversification Opportunities for First State and Bangkok Bank
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between First and Bangkok is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding First State Financial and Bangkok Bank Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bangkok Bank Public and First State 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 First State Financial are associated (or correlated) with Bangkok Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bangkok Bank Public has no effect on the direction of First State i.e., First State and Bangkok Bank go up and down completely randomly.
Pair Corralation between First State and Bangkok Bank
If you would invest 380.00 in Bangkok Bank Public on September 19, 2024 and sell it today you would earn a total of 35.00 from holding Bangkok Bank Public or generate 9.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
First State Financial vs. Bangkok Bank Public
Performance |
| Timeline |
| First State Financial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Bangkok Bank Public |
First State and Bangkok Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First State and Bangkok Bank
The main advantage of trading using opposite First State and Bangkok Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First State position performs unexpectedly, Bangkok Bank 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 Bangkok Bank will offset losses from the drop in Bangkok Bank's long position.| First State vs. First Interstate BancSystem | First State vs. First Financial Bankshares | First State vs. Independent Bank Group | First State vs. CVB Financial |
| Bangkok Bank vs. Morningstar Unconstrained Allocation | Bangkok Bank vs. Bondbloxx ETF Trust | Bangkok Bank vs. Spring Valley Acquisition | Bangkok Bank vs. Bondbloxx ETF Trust |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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