Correlation Between Lalin Property and Asia Plus
Can any of the company-specific risk be diversified away by investing in both Lalin Property and Asia Plus 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 Lalin Property and Asia Plus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lalin Property Public and Asia Plus Group, you can compare the effects of market volatilities on Lalin Property and Asia Plus 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 Lalin Property with a short position of Asia Plus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lalin Property and Asia Plus.
Diversification Opportunities for Lalin Property and Asia Plus
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lalin and Asia is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Lalin Property Public and Asia Plus Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Plus Group and Lalin Property 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 Lalin Property Public are associated (or correlated) with Asia Plus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Plus Group has no effect on the direction of Lalin Property i.e., Lalin Property and Asia Plus go up and down completely randomly.
Pair Corralation between Lalin Property and Asia Plus
Assuming the 90 days trading horizon Lalin Property Public is expected to under-perform the Asia Plus. But the stock apears to be less risky and, when comparing its historical volatility, Lalin Property Public is 1.02 times less risky than Asia Plus. The stock trades about -0.2 of its potential returns per unit of risk. The Asia Plus Group is currently generating about -0.16 of returns per unit of risk over similar time horizon. If you would invest 252.00 in Asia Plus Group on August 30, 2024 and sell it today you would lose (8.00) from holding Asia Plus Group or give up 3.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lalin Property Public vs. Asia Plus Group
Performance |
| Timeline |
| Lalin Property Public |
| Asia Plus Group |
Lalin Property and Asia Plus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lalin Property and Asia Plus
The main advantage of trading using opposite Lalin Property and Asia Plus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lalin Property position performs unexpectedly, Asia Plus 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 Asia Plus will offset losses from the drop in Asia Plus' long position.| Lalin Property vs. AP Public | Lalin Property vs. Land and Houses | Lalin Property vs. LPN Development Public | Lalin Property vs. Supalai Public |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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