Correlation Between Krungthai Card and Lease IT
Can any of the company-specific risk be diversified away by investing in both Krungthai Card and Lease IT 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 Krungthai Card and Lease IT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Krungthai Card PCL and Lease IT Public, you can compare the effects of market volatilities on Krungthai Card and Lease IT 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 Krungthai Card with a short position of Lease IT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Krungthai Card and Lease IT.
Diversification Opportunities for Krungthai Card and Lease IT
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Krungthai and Lease is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Krungthai Card PCL and Lease IT Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lease IT Public and Krungthai Card 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 Krungthai Card PCL are associated (or correlated) with Lease IT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lease IT Public has no effect on the direction of Krungthai Card i.e., Krungthai Card and Lease IT go up and down completely randomly.
Pair Corralation between Krungthai Card and Lease IT
Assuming the 90 days trading horizon Krungthai Card is expected to generate 84.46 times less return on investment than Lease IT. But when comparing it to its historical volatility, Krungthai Card PCL is 47.1 times less risky than Lease IT. It trades about 0.03 of its potential returns per unit of risk. Lease IT Public is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 102.00 in Lease IT Public on September 14, 2024 and sell it today you would lose (28.00) from holding Lease IT Public or give up 27.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.62% |
| Values | Daily Returns |
Krungthai Card PCL vs. Lease IT Public
Performance |
| Timeline |
| Krungthai Card PCL |
| Lease IT Public |
Krungthai Card and Lease IT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Krungthai Card and Lease IT
The main advantage of trading using opposite Krungthai Card and Lease IT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Krungthai Card position performs unexpectedly, Lease IT 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 Lease IT will offset losses from the drop in Lease IT's long position.| Krungthai Card vs. Krung Thai Bank | Krungthai Card vs. SCB X Public | Krungthai Card vs. Bangkok Bank Public | Krungthai Card vs. PTT Public |
| Lease IT vs. Srisawad Power 1979 | Lease IT vs. Muangthai Capital Public | Lease IT vs. Micro Leasing Public | Lease IT vs. Krungthai Card PCL |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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