Correlation Between KGI Securities and Lalin Property
Can any of the company-specific risk be diversified away by investing in both KGI Securities and Lalin Property 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 Lalin Property 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 Lalin Property Public, you can compare the effects of market volatilities on KGI Securities and Lalin Property 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 Lalin Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of KGI Securities and Lalin Property.
Diversification Opportunities for KGI Securities and Lalin Property
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between KGI and Lalin is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding KGI Securities Public and Lalin Property Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lalin Property Public 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 Lalin Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lalin Property Public has no effect on the direction of KGI Securities i.e., KGI Securities and Lalin Property go up and down completely randomly.
Pair Corralation between KGI Securities and Lalin Property
Assuming the 90 days trading horizon KGI Securities Public is expected to under-perform the Lalin Property. But the stock apears to be less risky and, when comparing its historical volatility, KGI Securities Public is 1.59 times less risky than Lalin Property. The stock trades about -0.38 of its potential returns per unit of risk. The Lalin Property Public is currently generating about -0.2 of returns per unit of risk over similar time horizon. If you would invest 640.00 in Lalin Property Public on August 30, 2024 and sell it today you would lose (25.00) from holding Lalin Property Public or give up 3.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KGI Securities Public vs. Lalin Property Public
Performance |
| Timeline |
| KGI Securities Public |
| Lalin Property Public |
KGI Securities and Lalin Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KGI Securities and Lalin Property
The main advantage of trading using opposite KGI Securities and Lalin Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KGI Securities position performs unexpectedly, Lalin Property 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 Lalin Property will offset losses from the drop in Lalin Property's long position.| KGI Securities vs. AAPICO Hitech Public | KGI Securities vs. Namwiwat Medical | KGI Securities vs. Heng Leasing Capital | KGI Securities vs. INET Leasehold REIT |
| Lalin Property vs. AP Public | Lalin Property vs. Land and Houses | Lalin Property vs. LPN Development Public | Lalin Property vs. Supalai 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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