Correlation Between KGI Securities and CIMB Thai
Can any of the company-specific risk be diversified away by investing in both KGI Securities and CIMB Thai 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 KGI Securities and CIMB Thai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KGI Securities Public and CIMB Thai Bank, you can compare the effects of market volatilities on KGI Securities and CIMB Thai 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 KGI Securities with a short position of CIMB Thai. Check out your portfolio center. Please also check ongoing floating volatility patterns of KGI Securities and CIMB Thai.
Diversification Opportunities for KGI Securities and CIMB Thai
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between KGI and CIMB is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding KGI Securities Public and CIMB Thai Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIMB Thai Bank and KGI Securities 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 KGI Securities Public are associated (or correlated) with CIMB Thai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIMB Thai Bank has no effect on the direction of KGI Securities i.e., KGI Securities and CIMB Thai go up and down completely randomly.
Pair Corralation between KGI Securities and CIMB Thai
Assuming the 90 days trading horizon KGI Securities Public is expected to generate 0.38 times more return on investment than CIMB Thai. However, KGI Securities Public is 2.63 times less risky than CIMB Thai. It trades about -0.26 of its potential returns per unit of risk. CIMB Thai Bank is currently generating about -0.48 per unit of risk. If you would invest 432.00 in KGI Securities Public on September 13, 2024 and sell it today you would lose (12.00) from holding KGI Securities Public or give up 2.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KGI Securities Public vs. CIMB Thai Bank
Performance |
| Timeline |
| KGI Securities Public |
| CIMB Thai Bank |
KGI Securities and CIMB Thai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KGI Securities and CIMB Thai
The main advantage of trading using opposite KGI Securities and CIMB Thai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KGI Securities position performs unexpectedly, CIMB Thai 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 CIMB Thai will offset losses from the drop in CIMB Thai's long position.| KGI Securities vs. Indara Insurance Public | KGI Securities vs. Asia Medical Agricultural | KGI Securities vs. Charan Insurance Public | KGI Securities vs. Teka Construction PCL |
| CIMB Thai vs. KGI Securities Public | CIMB Thai vs. Lalin Property Public | CIMB Thai vs. Hwa Fong Rubber | CIMB Thai vs. MCS Steel 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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