Correlation Between Heng Leasing and Yong Concrete
Can any of the company-specific risk be diversified away by investing in both Heng Leasing and Yong Concrete 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 Heng Leasing and Yong Concrete into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Heng Leasing Capital and Yong Concrete PCL, you can compare the effects of market volatilities on Heng Leasing and Yong Concrete 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 Heng Leasing with a short position of Yong Concrete. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heng Leasing and Yong Concrete.
Diversification Opportunities for Heng Leasing and Yong Concrete
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Heng and Yong is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Heng Leasing Capital and Yong Concrete PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yong Concrete PCL and Heng Leasing 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 Heng Leasing Capital are associated (or correlated) with Yong Concrete. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yong Concrete PCL has no effect on the direction of Heng Leasing i.e., Heng Leasing and Yong Concrete go up and down completely randomly.
Pair Corralation between Heng Leasing and Yong Concrete
Assuming the 90 days trading horizon Heng Leasing Capital is expected to generate 1.31 times more return on investment than Yong Concrete. However, Heng Leasing is 1.31 times more volatile than Yong Concrete PCL. It trades about -0.01 of its potential returns per unit of risk. Yong Concrete PCL is currently generating about -0.12 per unit of risk. If you would invest 136.00 in Heng Leasing Capital on September 1, 2024 and sell it today you would lose (18.00) from holding Heng Leasing Capital or give up 13.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.2% |
| Values | Daily Returns |
Heng Leasing Capital vs. Yong Concrete PCL
Performance |
| Timeline |
| Heng Leasing Capital |
| Yong Concrete PCL |
Heng Leasing and Yong Concrete Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heng Leasing and Yong Concrete
The main advantage of trading using opposite Heng Leasing and Yong Concrete positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heng Leasing position performs unexpectedly, Yong Concrete 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 Yong Concrete will offset losses from the drop in Yong Concrete's long position.| Heng Leasing vs. Bangkok Commercial Asset | Heng Leasing vs. Siam Global House | Heng Leasing vs. Dohome Public | Heng Leasing vs. JMT Network Services |
| Yong Concrete vs. Exotic Food Public | Yong Concrete vs. Knight Club Capital | Yong Concrete vs. North East Rubbers | Yong Concrete vs. Yggdrazil Group 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |