Correlation Between Home Product and Bangkok Life
Can any of the company-specific risk be diversified away by investing in both Home Product and Bangkok Life 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 Home Product and Bangkok Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Home Product Center and Bangkok Life Assurance, you can compare the effects of market volatilities on Home Product and Bangkok Life 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 Home Product with a short position of Bangkok Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Product and Bangkok Life.
Diversification Opportunities for Home Product and Bangkok Life
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Home and Bangkok is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Home Product Center and Bangkok Life Assurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bangkok Life Assurance and Home Product 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 Home Product Center are associated (or correlated) with Bangkok Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bangkok Life Assurance has no effect on the direction of Home Product i.e., Home Product and Bangkok Life go up and down completely randomly.
Pair Corralation between Home Product and Bangkok Life
Assuming the 90 days trading horizon Home Product Center is expected to under-perform the Bangkok Life. But the stock apears to be less risky and, when comparing its historical volatility, Home Product Center is 1.34 times less risky than Bangkok Life. The stock trades about -0.04 of its potential returns per unit of risk. The Bangkok Life Assurance is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 2,584 in Bangkok Life Assurance on August 31, 2024 and sell it today you would lose (524.00) from holding Bangkok Life Assurance or give up 20.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Home Product Center vs. Bangkok Life Assurance
Performance |
| Timeline |
| Home Product Center |
| Bangkok Life Assurance |
Home Product and Bangkok Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Home Product and Bangkok Life
The main advantage of trading using opposite Home Product and Bangkok Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Home Product position performs unexpectedly, Bangkok Life 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 Bangkok Life will offset losses from the drop in Bangkok Life's long position.| Home Product vs. CP ALL Public | Home Product vs. Bangkok Dusit Medical | Home Product vs. Central Pattana Public | Home Product vs. Advanced Info Service |
| Bangkok Life vs. Bangkok Bank Public | Bangkok Life vs. Indorama Ventures PCL | Bangkok Life vs. Bumrungrad Hospital Public | Bangkok Life 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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |