Correlation Between Kang Yong and Grande Asset
Can any of the company-specific risk be diversified away by investing in both Kang Yong and Grande Asset 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 Grande Asset 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 Grande Asset Hotels, you can compare the effects of market volatilities on Kang Yong and Grande Asset 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 Grande Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kang Yong and Grande Asset.
Diversification Opportunities for Kang Yong and Grande Asset
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kang and Grande is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Kang Yong Electric and Grande Asset Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grande Asset Hotels 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 Grande Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grande Asset Hotels has no effect on the direction of Kang Yong i.e., Kang Yong and Grande Asset go up and down completely randomly.
Pair Corralation between Kang Yong and Grande Asset
Assuming the 90 days trading horizon Kang Yong Electric is expected to generate 0.05 times more return on investment than Grande Asset. However, Kang Yong Electric is 20.76 times less risky than Grande Asset. It trades about -0.14 of its potential returns per unit of risk. Grande Asset Hotels is currently generating about -0.1 per unit of risk. If you would invest 29,200 in Kang Yong Electric on August 29, 2024 and sell it today you would lose (300.00) from holding Kang Yong Electric or give up 1.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kang Yong Electric vs. Grande Asset Hotels
Performance |
| Timeline |
| Kang Yong Electric |
| Grande Asset Hotels |
Kang Yong and Grande Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kang Yong and Grande Asset
The main advantage of trading using opposite Kang Yong and Grande Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kang Yong position performs unexpectedly, Grande Asset 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 Grande Asset will offset losses from the drop in Grande Asset's long position.| Kang Yong vs. Hwa Fong Rubber | Kang Yong vs. Hana Microelectronics Public | Kang Yong vs. KGI Securities Public | Kang Yong vs. Haad Thip Public |
| Grande Asset vs. CP ALL Public | Grande Asset vs. Bangkok Dusit Medical | Grande Asset vs. Central Pattana Public | Grande Asset vs. Advanced Info Service |
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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