Correlation Between Kingsmen CMTI and Hydrotek Public
Can any of the company-specific risk be diversified away by investing in both Kingsmen CMTI and Hydrotek Public 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 Kingsmen CMTI and Hydrotek Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kingsmen CMTI Public and Hydrotek Public, you can compare the effects of market volatilities on Kingsmen CMTI and Hydrotek Public 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 Kingsmen CMTI with a short position of Hydrotek Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kingsmen CMTI and Hydrotek Public.
Diversification Opportunities for Kingsmen CMTI and Hydrotek Public
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kingsmen and Hydrotek is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Kingsmen CMTI Public and Hydrotek Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hydrotek Public and Kingsmen CMTI 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 Kingsmen CMTI Public are associated (or correlated) with Hydrotek Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hydrotek Public has no effect on the direction of Kingsmen CMTI i.e., Kingsmen CMTI and Hydrotek Public go up and down completely randomly.
Pair Corralation between Kingsmen CMTI and Hydrotek Public
Given the investment horizon of 90 days Kingsmen CMTI Public is expected to generate 0.27 times more return on investment than Hydrotek Public. However, Kingsmen CMTI Public is 3.68 times less risky than Hydrotek Public. It trades about -0.13 of its potential returns per unit of risk. Hydrotek Public is currently generating about -0.07 per unit of risk. If you would invest 135.00 in Kingsmen CMTI Public on August 25, 2024 and sell it today you would lose (15.00) from holding Kingsmen CMTI Public or give up 11.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kingsmen CMTI Public vs. Hydrotek Public
Performance |
| Timeline |
| Kingsmen CMTI Public |
| Hydrotek Public |
Kingsmen CMTI and Hydrotek Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kingsmen CMTI and Hydrotek Public
The main advantage of trading using opposite Kingsmen CMTI and Hydrotek Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kingsmen CMTI position performs unexpectedly, Hydrotek Public 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 Hydrotek Public will offset losses from the drop in Hydrotek Public's long position.| Kingsmen CMTI vs. Cho Thavee Public | Kingsmen CMTI vs. G Capital Public | Kingsmen CMTI vs. Thai Ha Public | Kingsmen CMTI vs. Panjawattana Plastic Public |
| Hydrotek Public vs. TCM Public | Hydrotek Public vs. The Steel Public | Hydrotek Public vs. The Erawan Group | Hydrotek Public vs. Ditto 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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