Correlation Between Kiatnakin Phatra and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Kiatnakin Phatra and Dow Jones 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 Dow Jones 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 Dow Jones Industrial, you can compare the effects of market volatilities on Kiatnakin Phatra and Dow Jones 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 Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kiatnakin Phatra and Dow Jones.
Diversification Opportunities for Kiatnakin Phatra and Dow Jones
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kiatnakin and Dow is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Kiatnakin Phatra Bank and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial 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 Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of Kiatnakin Phatra i.e., Kiatnakin Phatra and Dow Jones go up and down completely randomly.
Pair Corralation between Kiatnakin Phatra and Dow Jones
Assuming the 90 days trading horizon Kiatnakin Phatra Bank is expected to under-perform the Dow Jones. In addition to that, Kiatnakin Phatra is 2.07 times more volatile than Dow Jones Industrial. It trades about -0.02 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.08 per unit of volatility. If you would invest 3,359,792 in Dow Jones Industrial on August 28, 2024 and sell it today you would earn a total of 1,113,865 from holding Dow Jones Industrial or generate 33.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.17% |
| Values | Daily Returns |
Kiatnakin Phatra Bank vs. Dow Jones Industrial
Performance |
| Timeline |
Kiatnakin Phatra and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Kiatnakin Phatra Bank
Pair trading matchups for Kiatnakin Phatra
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Kiatnakin Phatra and Dow Jones
The main advantage of trading using opposite Kiatnakin Phatra and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kiatnakin Phatra position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| Kiatnakin Phatra vs. Thai Energy Storage | Kiatnakin Phatra vs. Royal Orchid Hotel | Kiatnakin Phatra vs. Grand Canal Land | Kiatnakin Phatra vs. PRG Public |
| Dow Jones vs. Meiwu Technology Co | Dow Jones vs. 17 Education Technology | Dow Jones vs. 51Talk Online Education | Dow Jones vs. Afya |
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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