Correlation Between PTT Global and CENTURIA OFFICE
Can any of the company-specific risk be diversified away by investing in both PTT Global and CENTURIA OFFICE 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 PTT Global and CENTURIA OFFICE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PTT Global Chemical and CENTURIA OFFICE REIT, you can compare the effects of market volatilities on PTT Global and CENTURIA OFFICE 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 PTT Global with a short position of CENTURIA OFFICE. Check out your portfolio center. Please also check ongoing floating volatility patterns of PTT Global and CENTURIA OFFICE.
Diversification Opportunities for PTT Global and CENTURIA OFFICE
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between PTT and CENTURIA is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding PTT Global Chemical and CENTURIA OFFICE REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CENTURIA OFFICE REIT and PTT Global 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 PTT Global Chemical are associated (or correlated) with CENTURIA OFFICE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CENTURIA OFFICE REIT has no effect on the direction of PTT Global i.e., PTT Global and CENTURIA OFFICE go up and down completely randomly.
Pair Corralation between PTT Global and CENTURIA OFFICE
Assuming the 90 days trading horizon PTT Global Chemical is expected to generate 12.75 times more return on investment than CENTURIA OFFICE. However, PTT Global is 12.75 times more volatile than CENTURIA OFFICE REIT. It trades about 0.04 of its potential returns per unit of risk. CENTURIA OFFICE REIT is currently generating about 0.02 per unit of risk. If you would invest 108.00 in PTT Global Chemical on August 31, 2024 and sell it today you would lose (44.00) from holding PTT Global Chemical or give up 40.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.74% |
| Values | Daily Returns |
PTT Global Chemical vs. CENTURIA OFFICE REIT
Performance |
| Timeline |
| PTT Global Chemical |
| CENTURIA OFFICE REIT |
PTT Global and CENTURIA OFFICE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PTT Global and CENTURIA OFFICE
The main advantage of trading using opposite PTT Global and CENTURIA OFFICE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PTT Global position performs unexpectedly, CENTURIA OFFICE 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 CENTURIA OFFICE will offset losses from the drop in CENTURIA OFFICE's long position.The idea behind PTT Global Chemical and CENTURIA OFFICE REIT 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.| CENTURIA OFFICE vs. MHP Hotel AG | CENTURIA OFFICE vs. Playa Hotels Resorts | CENTURIA OFFICE vs. InterContinental Hotels Group | CENTURIA OFFICE vs. Meli Hotels 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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