Correlation Between Kang Yong and Bangkok Bank
Can any of the company-specific risk be diversified away by investing in both Kang Yong and Bangkok Bank 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 Kang Yong and Bangkok Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kang Yong Electric and Bangkok Bank Public, you can compare the effects of market volatilities on Kang Yong and Bangkok Bank 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 Kang Yong with a short position of Bangkok Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kang Yong and Bangkok Bank.
Diversification Opportunities for Kang Yong and Bangkok Bank
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Kang and Bangkok is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Kang Yong Electric and Bangkok Bank Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bangkok Bank Public and Kang Yong 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 Kang Yong Electric are associated (or correlated) with Bangkok Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bangkok Bank Public has no effect on the direction of Kang Yong i.e., Kang Yong and Bangkok Bank go up and down completely randomly.
Pair Corralation between Kang Yong and Bangkok Bank
Assuming the 90 days trading horizon Kang Yong Electric is expected to under-perform the Bangkok Bank. But the stock apears to be less risky and, when comparing its historical volatility, Kang Yong Electric is 3.09 times less risky than Bangkok Bank. The stock trades about -0.1 of its potential returns per unit of risk. The Bangkok Bank Public is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 14,900 in Bangkok Bank Public on August 24, 2024 and sell it today you would earn a total of 50.00 from holding Bangkok Bank Public or generate 0.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kang Yong Electric vs. Bangkok Bank Public
Performance |
| Timeline |
| Kang Yong Electric |
| Bangkok Bank Public |
Kang Yong and Bangkok Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kang Yong and Bangkok Bank
The main advantage of trading using opposite Kang Yong and Bangkok Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kang Yong position performs unexpectedly, Bangkok Bank 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 Bangkok Bank will offset losses from the drop in Bangkok Bank's long position.| Kang Yong vs. SCB X Public | Kang Yong vs. Kasikornbank Public | Kang Yong vs. PTT Public | Kang Yong vs. Kasikornbank Public |
| Bangkok Bank vs. SCB X Public | Bangkok Bank vs. Kasikornbank Public | Bangkok Bank vs. PTT Public | Bangkok Bank vs. The Siam Cement |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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