Correlation Between Hwa Fong and Phatra Leasing
Can any of the company-specific risk be diversified away by investing in both Hwa Fong and Phatra Leasing 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 Hwa Fong and Phatra Leasing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hwa Fong Rubber and Phatra Leasing Public, you can compare the effects of market volatilities on Hwa Fong and Phatra Leasing 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 Hwa Fong with a short position of Phatra Leasing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hwa Fong and Phatra Leasing.
Diversification Opportunities for Hwa Fong and Phatra Leasing
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hwa and Phatra is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Hwa Fong Rubber and Phatra Leasing Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phatra Leasing Public and Hwa Fong 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 Hwa Fong Rubber are associated (or correlated) with Phatra Leasing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phatra Leasing Public has no effect on the direction of Hwa Fong i.e., Hwa Fong and Phatra Leasing go up and down completely randomly.
Pair Corralation between Hwa Fong and Phatra Leasing
Assuming the 90 days trading horizon Hwa Fong Rubber is expected to generate 0.78 times more return on investment than Phatra Leasing. However, Hwa Fong Rubber is 1.29 times less risky than Phatra Leasing. It trades about -0.15 of its potential returns per unit of risk. Phatra Leasing Public is currently generating about -0.23 per unit of risk. If you would invest 428.00 in Hwa Fong Rubber on September 12, 2024 and sell it today you would lose (14.00) from holding Hwa Fong Rubber or give up 3.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hwa Fong Rubber vs. Phatra Leasing Public
Performance |
| Timeline |
| Hwa Fong Rubber |
| Phatra Leasing Public |
Hwa Fong and Phatra Leasing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hwa Fong and Phatra Leasing
The main advantage of trading using opposite Hwa Fong and Phatra Leasing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hwa Fong position performs unexpectedly, Phatra Leasing 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 Phatra Leasing will offset losses from the drop in Phatra Leasing's long position.| Hwa Fong vs. Haad Thip Public | Hwa Fong vs. AAPICO Hitech Public | Hwa Fong vs. Inoue Rubber Public | Hwa Fong vs. Hana Microelectronics Public |
| Phatra Leasing vs. KGI Securities Public | Phatra Leasing vs. Lalin Property Public | Phatra Leasing vs. Hwa Fong Rubber | Phatra Leasing vs. MCS Steel 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |