Correlation Between International Network and Yong Concrete
Can any of the company-specific risk be diversified away by investing in both International Network 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 International Network and Yong Concrete into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Network System and Yong Concrete PCL, you can compare the effects of market volatilities on International Network 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 International Network with a short position of Yong Concrete. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Network and Yong Concrete.
Diversification Opportunities for International Network and Yong Concrete
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between International and Yong is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding International Network System 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 International Network 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 International Network System 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 International Network i.e., International Network and Yong Concrete go up and down completely randomly.
Pair Corralation between International Network and Yong Concrete
Assuming the 90 days trading horizon International Network System is expected to under-perform the Yong Concrete. In addition to that, International Network is 1.14 times more volatile than Yong Concrete PCL. It trades about -0.08 of its total potential returns per unit of risk. Yong Concrete PCL is currently generating about -0.08 per unit of volatility. If you would invest 225.00 in Yong Concrete PCL on September 12, 2024 and sell it today you would lose (108.00) from holding Yong Concrete PCL or give up 48.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
International Network System vs. Yong Concrete PCL
Performance |
| Timeline |
| International Network |
| Yong Concrete PCL |
International Network and Yong Concrete Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Network and Yong Concrete
The main advantage of trading using opposite International Network and Yong Concrete positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Network 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.| International Network vs. Delta Electronics Public | International Network vs. Delta Electronics Public | International Network vs. Airports of Thailand | International Network vs. Airports of Thailand |
| Yong Concrete vs. Wave Entertainment Public | Yong Concrete vs. Vibhavadi Medical Center | Yong Concrete vs. TPI Polene Public | Yong Concrete vs. Asia Green Energy |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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