Correlation Between Khon Kaen and IRPC Public
Can any of the company-specific risk be diversified away by investing in both Khon Kaen and IRPC Public 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 Khon Kaen and IRPC Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Khon Kaen Sugar and IRPC Public, you can compare the effects of market volatilities on Khon Kaen and IRPC Public 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 Khon Kaen with a short position of IRPC Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Khon Kaen and IRPC Public.
Diversification Opportunities for Khon Kaen and IRPC Public
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Khon and IRPC is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Khon Kaen Sugar and IRPC Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IRPC Public and Khon Kaen 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 Khon Kaen Sugar are associated (or correlated) with IRPC Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IRPC Public has no effect on the direction of Khon Kaen i.e., Khon Kaen and IRPC Public go up and down completely randomly.
Pair Corralation between Khon Kaen and IRPC Public
Assuming the 90 days trading horizon Khon Kaen Sugar is expected to generate 1.0 times more return on investment than IRPC Public. However, Khon Kaen Sugar is 1.0 times less risky than IRPC Public. It trades about 0.06 of its potential returns per unit of risk. IRPC Public is currently generating about 0.06 per unit of risk. If you would invest 249.00 in Khon Kaen Sugar on September 4, 2024 and sell it today you would lose (52.00) from holding Khon Kaen Sugar or give up 20.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Khon Kaen Sugar vs. IRPC Public
Performance |
| Timeline |
| Khon Kaen Sugar |
| IRPC Public |
Khon Kaen and IRPC Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Khon Kaen and IRPC Public
The main advantage of trading using opposite Khon Kaen and IRPC Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Khon Kaen position performs unexpectedly, IRPC Public 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 IRPC Public will offset losses from the drop in IRPC Public's long position.| Khon Kaen vs. Airports of Thailand | Khon Kaen vs. PTT Public | Khon Kaen vs. Bangkok Dusit Medical | Khon Kaen vs. Kasikornbank Public |
| IRPC Public vs. PTT Global Chemical | IRPC Public vs. PTT Public | IRPC Public vs. PTT Exploration and | IRPC Public vs. Thai Oil 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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