Correlation Between Kiatnakin Phatra and Airports
Can any of the company-specific risk be diversified away by investing in both Kiatnakin Phatra and Airports 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 Kiatnakin Phatra and Airports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kiatnakin Phatra Bank and Airports of Thailand, you can compare the effects of market volatilities on Kiatnakin Phatra and Airports 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 Kiatnakin Phatra with a short position of Airports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kiatnakin Phatra and Airports.
Diversification Opportunities for Kiatnakin Phatra and Airports
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kiatnakin and Airports is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Kiatnakin Phatra Bank and Airports of Thailand in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airports of Thailand and Kiatnakin Phatra 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 Kiatnakin Phatra Bank are associated (or correlated) with Airports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airports of Thailand has no effect on the direction of Kiatnakin Phatra i.e., Kiatnakin Phatra and Airports go up and down completely randomly.
Pair Corralation between Kiatnakin Phatra and Airports
Assuming the 90 days trading horizon Kiatnakin Phatra Bank is expected to generate 116.46 times more return on investment than Airports. However, Kiatnakin Phatra is 116.46 times more volatile than Airports of Thailand. It trades about 0.11 of its potential returns per unit of risk. Airports of Thailand is currently generating about -0.03 per unit of risk. If you would invest 6,300 in Kiatnakin Phatra Bank on September 2, 2024 and sell it today you would lose (1,250) from holding Kiatnakin Phatra Bank or give up 19.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.4% |
| Values | Daily Returns |
Kiatnakin Phatra Bank vs. Airports of Thailand
Performance |
| Timeline |
| Kiatnakin Phatra Bank |
| Airports of Thailand |
Kiatnakin Phatra and Airports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kiatnakin Phatra and Airports
The main advantage of trading using opposite Kiatnakin Phatra and Airports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kiatnakin Phatra position performs unexpectedly, Airports 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 Airports will offset losses from the drop in Airports' long position.| Kiatnakin Phatra vs. Porn Prom Metal | Kiatnakin Phatra vs. Bumrungrad Hospital Public | Kiatnakin Phatra vs. Mena Transport Public | Kiatnakin Phatra vs. Interlink Communication Public |
| Airports vs. CP ALL Public | Airports vs. PTT Public | Airports vs. Kasikornbank Public | Airports vs. Bangkok Dusit Medical |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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