Correlation Between Kasikornbank Public and Khon Kaen
Can any of the company-specific risk be diversified away by investing in both Kasikornbank Public and Khon Kaen 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 Kasikornbank Public and Khon Kaen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kasikornbank Public and Khon Kaen Sugar, you can compare the effects of market volatilities on Kasikornbank Public and Khon Kaen 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 Kasikornbank Public with a short position of Khon Kaen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kasikornbank Public and Khon Kaen.
Diversification Opportunities for Kasikornbank Public and Khon Kaen
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kasikornbank and Khon is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Kasikornbank Public and Khon Kaen Sugar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Khon Kaen Sugar and Kasikornbank Public 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 Kasikornbank Public are associated (or correlated) with Khon Kaen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Khon Kaen Sugar has no effect on the direction of Kasikornbank Public i.e., Kasikornbank Public and Khon Kaen go up and down completely randomly.
Pair Corralation between Kasikornbank Public and Khon Kaen
Assuming the 90 days trading horizon Kasikornbank Public is expected to generate 42.22 times less return on investment than Khon Kaen. But when comparing it to its historical volatility, Kasikornbank Public is 37.54 times less risky than Khon Kaen. It trades about 0.03 of its potential returns per unit of risk. Khon Kaen Sugar is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 354.00 in Khon Kaen Sugar on September 12, 2024 and sell it today you would lose (155.00) from holding Khon Kaen Sugar or give up 43.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kasikornbank Public vs. Khon Kaen Sugar
Performance |
| Timeline |
| Kasikornbank Public |
| Khon Kaen Sugar |
Kasikornbank Public and Khon Kaen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kasikornbank Public and Khon Kaen
The main advantage of trading using opposite Kasikornbank Public and Khon Kaen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kasikornbank Public position performs unexpectedly, Khon Kaen 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 Khon Kaen will offset losses from the drop in Khon Kaen's long position.| Kasikornbank Public vs. SCB X Public | Kasikornbank Public vs. Bangkok Bank Public | Kasikornbank Public vs. PTT Public | Kasikornbank Public vs. CP ALL Public |
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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