Correlation Between GM and Mahachai Hospital
Can any of the company-specific risk be diversified away by investing in both GM and Mahachai Hospital 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 GM and Mahachai Hospital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Mahachai Hospital Public, you can compare the effects of market volatilities on GM and Mahachai Hospital 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 GM with a short position of Mahachai Hospital. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Mahachai Hospital.
Diversification Opportunities for GM and Mahachai Hospital
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GM and Mahachai is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Mahachai Hospital Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mahachai Hospital Public and GM 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 Motors are associated (or correlated) with Mahachai Hospital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mahachai Hospital Public has no effect on the direction of GM i.e., GM and Mahachai Hospital go up and down completely randomly.
Pair Corralation between GM and Mahachai Hospital
Allowing for the 90-day total investment horizon GM is expected to generate 37.17 times less return on investment than Mahachai Hospital. But when comparing it to its historical volatility, General Motors is 39.08 times less risky than Mahachai Hospital. It trades about 0.08 of its potential returns per unit of risk. Mahachai Hospital Public is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 4,700 in Mahachai Hospital Public on September 1, 2024 and sell it today you would lose (1,825) from holding Mahachai Hospital Public or give up 38.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.41% |
| Values | Daily Returns |
General Motors vs. Mahachai Hospital Public
Performance |
| Timeline |
| General Motors |
| Mahachai Hospital Public |
GM and Mahachai Hospital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Mahachai Hospital
The main advantage of trading using opposite GM and Mahachai Hospital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Mahachai Hospital 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 Mahachai Hospital will offset losses from the drop in Mahachai Hospital's long position.The idea behind General Motors and Mahachai Hospital Public 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.| Mahachai Hospital vs. AP Public | Mahachai Hospital vs. Advanced Information Technology | Mahachai Hospital vs. AJ Plast Public | Mahachai Hospital vs. Berli Jucker 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |