Correlation Between Kaset Thai and MK Restaurant
Can any of the company-specific risk be diversified away by investing in both Kaset Thai and MK Restaurant 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 Kaset Thai and MK Restaurant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kaset Thai International and MK Restaurant Group, you can compare the effects of market volatilities on Kaset Thai and MK Restaurant 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 Kaset Thai with a short position of MK Restaurant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaset Thai and MK Restaurant.
Diversification Opportunities for Kaset Thai and MK Restaurant
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Kaset and MK Restaurant is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Kaset Thai International and MK Restaurant Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MK Restaurant Group and Kaset Thai 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 Kaset Thai International are associated (or correlated) with MK Restaurant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MK Restaurant Group has no effect on the direction of Kaset Thai i.e., Kaset Thai and MK Restaurant go up and down completely randomly.
Pair Corralation between Kaset Thai and MK Restaurant
Assuming the 90 days trading horizon Kaset Thai International is expected to generate 30.04 times more return on investment than MK Restaurant. However, Kaset Thai is 30.04 times more volatile than MK Restaurant Group. It trades about 0.04 of its potential returns per unit of risk. MK Restaurant Group is currently generating about -0.1 per unit of risk. If you would invest 339.00 in Kaset Thai International on September 3, 2024 and sell it today you would lose (39.00) from holding Kaset Thai International or give up 11.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kaset Thai International vs. MK Restaurant Group
Performance |
| Timeline |
| Kaset Thai International |
| MK Restaurant Group |
Kaset Thai and MK Restaurant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kaset Thai and MK Restaurant
The main advantage of trading using opposite Kaset Thai and MK Restaurant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaset Thai position performs unexpectedly, MK Restaurant 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 MK Restaurant will offset losses from the drop in MK Restaurant's long position.| Kaset Thai vs. Khon Kaen Sugar | Kaset Thai vs. Khonburi Sugar Public | Kaset Thai vs. Ichitan Group Public | Kaset Thai vs. MK Restaurant Group |
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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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