Correlation Between Global Service and Kingsmen CMTI
Can any of the company-specific risk be diversified away by investing in both Global Service and Kingsmen CMTI 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 Global Service and Kingsmen CMTI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Service Center and Kingsmen CMTI Public, you can compare the effects of market volatilities on Global Service and Kingsmen CMTI 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 Global Service with a short position of Kingsmen CMTI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Service and Kingsmen CMTI.
Diversification Opportunities for Global Service and Kingsmen CMTI
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Global and Kingsmen is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Global Service Center and Kingsmen CMTI Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kingsmen CMTI Public and Global Service 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 Global Service Center are associated (or correlated) with Kingsmen CMTI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kingsmen CMTI Public has no effect on the direction of Global Service i.e., Global Service and Kingsmen CMTI go up and down completely randomly.
Pair Corralation between Global Service and Kingsmen CMTI
Assuming the 90 days trading horizon Global Service is expected to generate 1.11 times less return on investment than Kingsmen CMTI. In addition to that, Global Service is 1.0 times more volatile than Kingsmen CMTI Public. It trades about 0.05 of its total potential returns per unit of risk. Kingsmen CMTI Public is currently generating about 0.06 per unit of volatility. If you would invest 98.00 in Kingsmen CMTI Public on August 24, 2024 and sell it today you would earn a total of 22.00 from holding Kingsmen CMTI Public or generate 22.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Service Center vs. Kingsmen CMTI Public
Performance |
| Timeline |
| Global Service Center |
| Kingsmen CMTI Public |
Global Service and Kingsmen CMTI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Service and Kingsmen CMTI
The main advantage of trading using opposite Global Service and Kingsmen CMTI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Service position performs unexpectedly, Kingsmen CMTI 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 Kingsmen CMTI will offset losses from the drop in Kingsmen CMTI's long position.| Global Service vs. Com7 PCL | Global Service vs. TKS Technologies Public | Global Service vs. Rajthanee Hospital Public | Global Service vs. The Erawan Group |
| Kingsmen CMTI vs. Com7 PCL | Kingsmen CMTI vs. TKS Technologies Public | Kingsmen CMTI vs. Rajthanee Hospital Public | Kingsmen CMTI vs. The Erawan Group |
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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