Correlation Between Gulf Energy and Airports
Can any of the company-specific risk be diversified away by investing in both Gulf Energy 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 Gulf Energy and Airports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gulf Energy Development and Airports of Thailand, you can compare the effects of market volatilities on Gulf Energy 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 Gulf Energy with a short position of Airports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gulf Energy and Airports.
Diversification Opportunities for Gulf Energy and Airports
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Gulf and Airports is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Gulf Energy Development 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 Gulf Energy 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 Gulf Energy Development 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 Gulf Energy i.e., Gulf Energy and Airports go up and down completely randomly.
Pair Corralation between Gulf Energy and Airports
Assuming the 90 days trading horizon Gulf Energy Development is expected to under-perform the Airports. In addition to that, Gulf Energy is 1.44 times more volatile than Airports of Thailand. It trades about -0.1 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 6,150 in Airports of Thailand on August 25, 2024 and sell it today you would lose (25.00) from holding Airports of Thailand or give up 0.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Gulf Energy Development vs. Airports of Thailand
Performance |
| Timeline |
| Gulf Energy Development |
| Airports of Thailand |
Gulf Energy and Airports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gulf Energy and Airports
The main advantage of trading using opposite Gulf Energy and Airports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gulf Energy 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.| Gulf Energy vs. WHA Public | Gulf Energy vs. TPI Polene Power | Gulf Energy vs. Bangkok Expressway and | Gulf Energy vs. BGrimm Power Public |
| 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |