Correlation Between Lanna Resources and Banpu Public
Can any of the company-specific risk be diversified away by investing in both Lanna Resources and Banpu Public 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 Lanna Resources and Banpu Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lanna Resources Public and Banpu Public, you can compare the effects of market volatilities on Lanna Resources and Banpu Public 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 Lanna Resources with a short position of Banpu Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lanna Resources and Banpu Public.
Diversification Opportunities for Lanna Resources and Banpu Public
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lanna and Banpu is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Lanna Resources Public and Banpu Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banpu Public and Lanna Resources 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 Lanna Resources Public are associated (or correlated) with Banpu Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banpu Public has no effect on the direction of Lanna Resources i.e., Lanna Resources and Banpu Public go up and down completely randomly.
Pair Corralation between Lanna Resources and Banpu Public
Assuming the 90 days trading horizon Lanna Resources Public is expected to generate 0.59 times more return on investment than Banpu Public. However, Lanna Resources Public is 1.68 times less risky than Banpu Public. It trades about 0.12 of its potential returns per unit of risk. Banpu Public is currently generating about 0.05 per unit of risk. If you would invest 1,303 in Lanna Resources Public on November 3, 2024 and sell it today you would earn a total of 327.00 from holding Lanna Resources Public or generate 25.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lanna Resources Public vs. Banpu Public
Performance |
| Timeline |
| Lanna Resources Public |
| Banpu Public |
Lanna Resources and Banpu Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lanna Resources and Banpu Public
The main advantage of trading using opposite Lanna Resources and Banpu Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lanna Resources position performs unexpectedly, Banpu Public 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 Banpu Public will offset losses from the drop in Banpu Public's long position.| Lanna Resources vs. IRPC Public | Lanna Resources vs. Power Solution Technologies | Lanna Resources vs. Star Petroleum Refining | Lanna Resources vs. SCG PACKAGING PCL NVDR |
| Banpu Public vs. PTT Public | Banpu Public vs. PTT Exploration and | Banpu Public vs. Bangkok Bank Public | Banpu Public vs. Thai Oil 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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