Correlation Between Lalin Property and Nawarat Patanakarn
Can any of the company-specific risk be diversified away by investing in both Lalin Property and Nawarat Patanakarn 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 Nawarat Patanakarn 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 Nawarat Patanakarn Public, you can compare the effects of market volatilities on Lalin Property and Nawarat Patanakarn 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 Nawarat Patanakarn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lalin Property and Nawarat Patanakarn.
Diversification Opportunities for Lalin Property and Nawarat Patanakarn
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lalin and Nawarat is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Lalin Property Public and Nawarat Patanakarn Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nawarat Patanakarn Public 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 Nawarat Patanakarn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nawarat Patanakarn Public has no effect on the direction of Lalin Property i.e., Lalin Property and Nawarat Patanakarn go up and down completely randomly.
Pair Corralation between Lalin Property and Nawarat Patanakarn
Assuming the 90 days trading horizon Lalin Property Public is expected to generate 0.22 times more return on investment than Nawarat Patanakarn. However, Lalin Property Public is 4.65 times less risky than Nawarat Patanakarn. It trades about -0.05 of its potential returns per unit of risk. Nawarat Patanakarn Public is currently generating about -0.36 per unit of risk. If you would invest 625.00 in Lalin Property Public on September 13, 2024 and sell it today you would lose (5.00) from holding Lalin Property Public or give up 0.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lalin Property Public vs. Nawarat Patanakarn Public
Performance |
| Timeline |
| Lalin Property Public |
| Nawarat Patanakarn Public |
Lalin Property and Nawarat Patanakarn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lalin Property and Nawarat Patanakarn
The main advantage of trading using opposite Lalin Property and Nawarat Patanakarn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lalin Property position performs unexpectedly, Nawarat Patanakarn 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 Nawarat Patanakarn will offset losses from the drop in Nawarat Patanakarn's long position.| Lalin Property vs. Wave Entertainment Public | Lalin Property vs. Vibhavadi Medical Center | Lalin Property vs. VGI Public | Lalin Property vs. WHA Public |
| Nawarat Patanakarn vs. Tata Steel Public | Nawarat Patanakarn vs. TTCL Public | Nawarat Patanakarn vs. Thaifoods Group Public | Nawarat Patanakarn vs. TMT Steel Public |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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