Correlation Between General Environmental and Airports
Can any of the company-specific risk be diversified away by investing in both General Environmental and Airports 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 General Environmental and Airports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Environmental Conservation and Airports of Thailand, you can compare the effects of market volatilities on General Environmental and Airports 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 General Environmental with a short position of Airports. Check out your portfolio center. Please also check ongoing floating volatility patterns of General Environmental and Airports.
Diversification Opportunities for General Environmental and Airports
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between General and Airports is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding General Environmental Conserva and Airports of Thailand in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airports of Thailand and General Environmental 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 General Environmental Conservation are associated (or correlated) with Airports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airports of Thailand has no effect on the direction of General Environmental i.e., General Environmental and Airports go up and down completely randomly.
Pair Corralation between General Environmental and Airports
Assuming the 90 days trading horizon General Environmental Conservation is expected to under-perform the Airports. In addition to that, General Environmental is 1.58 times more volatile than Airports of Thailand. It trades about -0.09 of its total potential returns per unit of risk. Airports of Thailand is currently generating about -0.01 per unit of volatility. If you would invest 6,225 in Airports of Thailand on September 5, 2024 and sell it today you would lose (25.00) from holding Airports of Thailand or give up 0.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Environmental Conserva vs. Airports of Thailand
Performance |
| Timeline |
| General Environmental |
| Airports of Thailand |
General Environmental and Airports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with General Environmental and Airports
The main advantage of trading using opposite General Environmental and Airports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if General Environmental position performs unexpectedly, Airports 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 Airports will offset losses from the drop in Airports' long position.| General Environmental vs. Asia Aviation Public | General Environmental vs. Bangkok Dusit Medical | General Environmental vs. Bangkok Expressway and | General Environmental vs. Airports of Thailand |
| Airports vs. CP ALL Public | Airports vs. PTT Public | Airports vs. Kasikornbank Public | Airports vs. Bangkok Dusit Medical |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Stocks Directory Find actively traded stocks across global markets | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |