Correlation Between Kiatnakin Phatra and TISCO Financial
Can any of the company-specific risk be diversified away by investing in both Kiatnakin Phatra and TISCO Financial 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 TISCO Financial 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 TISCO Financial Group, you can compare the effects of market volatilities on Kiatnakin Phatra and TISCO Financial 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 TISCO Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kiatnakin Phatra and TISCO Financial.
Diversification Opportunities for Kiatnakin Phatra and TISCO Financial
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kiatnakin and TISCO is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Kiatnakin Phatra Bank and TISCO Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TISCO Financial Group 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 TISCO Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TISCO Financial Group has no effect on the direction of Kiatnakin Phatra i.e., Kiatnakin Phatra and TISCO Financial go up and down completely randomly.
Pair Corralation between Kiatnakin Phatra and TISCO Financial
Assuming the 90 days trading horizon Kiatnakin Phatra Bank is expected to under-perform the TISCO Financial. In addition to that, Kiatnakin Phatra is 2.53 times more volatile than TISCO Financial Group. It trades about -0.02 of its total potential returns per unit of risk. TISCO Financial Group is currently generating about 0.06 per unit of volatility. If you would invest 8,160 in TISCO Financial Group on August 28, 2024 and sell it today you would earn a total of 1,465 from holding TISCO Financial Group or generate 17.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kiatnakin Phatra Bank vs. TISCO Financial Group
Performance |
| Timeline |
| Kiatnakin Phatra Bank |
| TISCO Financial Group |
Kiatnakin Phatra and TISCO Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kiatnakin Phatra and TISCO Financial
The main advantage of trading using opposite Kiatnakin Phatra and TISCO Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kiatnakin Phatra position performs unexpectedly, TISCO Financial 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 TISCO Financial will offset losses from the drop in TISCO Financial's 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 |
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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