Correlation Between Kasikornbank Public and Thai Stanley
Can any of the company-specific risk be diversified away by investing in both Kasikornbank Public and Thai Stanley 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 Thai Stanley into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kasikornbank Public and Thai Stanley Electric, you can compare the effects of market volatilities on Kasikornbank Public and Thai Stanley 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 Thai Stanley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kasikornbank Public and Thai Stanley.
Diversification Opportunities for Kasikornbank Public and Thai Stanley
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kasikornbank and Thai is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Kasikornbank Public and Thai Stanley Electric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Stanley Electric 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 Thai Stanley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Stanley Electric has no effect on the direction of Kasikornbank Public i.e., Kasikornbank Public and Thai Stanley go up and down completely randomly.
Pair Corralation between Kasikornbank Public and Thai Stanley
Assuming the 90 days trading horizon Kasikornbank Public is expected to generate 2.19 times more return on investment than Thai Stanley. However, Kasikornbank Public is 2.19 times more volatile than Thai Stanley Electric. It trades about 0.1 of its potential returns per unit of risk. Thai Stanley Electric is currently generating about 0.06 per unit of risk. If you would invest 14,650 in Kasikornbank Public on August 24, 2024 and sell it today you would earn a total of 250.00 from holding Kasikornbank Public or generate 1.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kasikornbank Public vs. Thai Stanley Electric
Performance |
| Timeline |
| Kasikornbank Public |
| Thai Stanley Electric |
Kasikornbank Public and Thai Stanley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kasikornbank Public and Thai Stanley
The main advantage of trading using opposite Kasikornbank Public and Thai Stanley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kasikornbank Public position performs unexpectedly, Thai Stanley 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 Thai Stanley will offset losses from the drop in Thai Stanley'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 |
| Thai Stanley vs. SCB X Public | Thai Stanley vs. Kasikornbank Public | Thai Stanley vs. PTT Public | Thai Stanley vs. Kasikornbank 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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