Correlation Between Getabec Public and Hwa Fong
Can any of the company-specific risk be diversified away by investing in both Getabec Public and Hwa Fong 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 Getabec Public and Hwa Fong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Getabec Public and Hwa Fong Rubber, you can compare the effects of market volatilities on Getabec Public and Hwa Fong 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 Getabec Public with a short position of Hwa Fong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Getabec Public and Hwa Fong.
Diversification Opportunities for Getabec Public and Hwa Fong
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Getabec and Hwa is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Getabec Public and Hwa Fong Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hwa Fong Rubber and Getabec Public 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 Getabec Public are associated (or correlated) with Hwa Fong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hwa Fong Rubber has no effect on the direction of Getabec Public i.e., Getabec Public and Hwa Fong go up and down completely randomly.
Pair Corralation between Getabec Public and Hwa Fong
Assuming the 90 days trading horizon Getabec Public is expected to generate 1.66 times more return on investment than Hwa Fong. However, Getabec Public is 1.66 times more volatile than Hwa Fong Rubber. It trades about -0.05 of its potential returns per unit of risk. Hwa Fong Rubber is currently generating about -0.2 per unit of risk. If you would invest 74.00 in Getabec Public on August 25, 2024 and sell it today you would lose (2.00) from holding Getabec Public or give up 2.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Getabec Public vs. Hwa Fong Rubber
Performance |
| Timeline |
| Getabec Public |
| Hwa Fong Rubber |
Getabec Public and Hwa Fong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Getabec Public and Hwa Fong
The main advantage of trading using opposite Getabec Public and Hwa Fong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Getabec Public position performs unexpectedly, Hwa Fong 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 Hwa Fong will offset losses from the drop in Hwa Fong's long position.| Getabec Public vs. Sabuy Technology Public | Getabec Public vs. Kulthorn Kirby Public | Getabec Public vs. The Erawan Group | Getabec Public vs. Airports of Thailand |
| Hwa Fong vs. SCB X Public | Hwa Fong vs. Kasikornbank Public | Hwa Fong vs. PTT Public | Hwa Fong vs. Kasikornbank 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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