Correlation Between Kiatnakin Phatra and Com7 PCL
Can any of the company-specific risk be diversified away by investing in both Kiatnakin Phatra and Com7 PCL 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 Com7 PCL 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 Com7 PCL, you can compare the effects of market volatilities on Kiatnakin Phatra and Com7 PCL 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 Com7 PCL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kiatnakin Phatra and Com7 PCL.
Diversification Opportunities for Kiatnakin Phatra and Com7 PCL
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kiatnakin and Com7 is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Kiatnakin Phatra Bank and Com7 PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Com7 PCL 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 Com7 PCL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Com7 PCL has no effect on the direction of Kiatnakin Phatra i.e., Kiatnakin Phatra and Com7 PCL go up and down completely randomly.
Pair Corralation between Kiatnakin Phatra and Com7 PCL
Assuming the 90 days trading horizon Kiatnakin Phatra Bank is expected to under-perform the Com7 PCL. But the stock apears to be less risky and, when comparing its historical volatility, Kiatnakin Phatra Bank is 1.55 times less risky than Com7 PCL. The stock trades about -0.03 of its potential returns per unit of risk. The Com7 PCL is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 3,060 in Com7 PCL on September 3, 2024 and sell it today you would lose (410.00) from holding Com7 PCL or give up 13.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kiatnakin Phatra Bank vs. Com7 PCL
Performance |
| Timeline |
| Kiatnakin Phatra Bank |
| Com7 PCL |
Kiatnakin Phatra and Com7 PCL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kiatnakin Phatra and Com7 PCL
The main advantage of trading using opposite Kiatnakin Phatra and Com7 PCL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kiatnakin Phatra position performs unexpectedly, Com7 PCL 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 Com7 PCL will offset losses from the drop in Com7 PCL's long position.| Kiatnakin Phatra vs. TISCO Financial Group | Kiatnakin Phatra vs. Kasikornbank Public | Kiatnakin Phatra vs. Thanachart Capital Public | Kiatnakin Phatra vs. SCB X Public |
| Com7 PCL vs. Central Pattana Public | Com7 PCL vs. CP ALL Public | Com7 PCL vs. Bangkok Dusit Medical | Com7 PCL vs. Airports of Thailand |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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