Correlation Between Kang Yong and Thaire Life
Can any of the company-specific risk be diversified away by investing in both Kang Yong and Thaire Life 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 Thaire Life 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 Thaire Life Assurance, you can compare the effects of market volatilities on Kang Yong and Thaire Life 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 Thaire Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kang Yong and Thaire Life.
Diversification Opportunities for Kang Yong and Thaire Life
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Kang and Thaire is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Kang Yong Electric and Thaire Life Assurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thaire Life Assurance 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 Thaire Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thaire Life Assurance has no effect on the direction of Kang Yong i.e., Kang Yong and Thaire Life go up and down completely randomly.
Pair Corralation between Kang Yong and Thaire Life
Assuming the 90 days trading horizon Kang Yong Electric is expected to generate 1.0 times more return on investment than Thaire Life. However, Kang Yong Electric is 1.0 times less risky than Thaire Life. It trades about 0.08 of its potential returns per unit of risk. Thaire Life Assurance is currently generating about 0.08 per unit of risk. If you would invest 30,339 in Kang Yong Electric on August 29, 2024 and sell it today you would lose (1,539) from holding Kang Yong Electric or give up 5.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kang Yong Electric vs. Thaire Life Assurance
Performance |
| Timeline |
| Kang Yong Electric |
| Thaire Life Assurance |
Kang Yong and Thaire Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kang Yong and Thaire Life
The main advantage of trading using opposite Kang Yong and Thaire Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kang Yong position performs unexpectedly, Thaire Life 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 Thaire Life will offset losses from the drop in Thaire Life'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 |
| Thaire Life vs. Karmarts Public | Thaire Life vs. Kang Yong Electric | Thaire Life vs. Kiatnakin Phatra Bank | Thaire Life vs. SCG PACKAGING PCL NVDR |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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