Correlation Between Land and Bangkok Bank
Can any of the company-specific risk be diversified away by investing in both Land and Bangkok Bank 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 Land and Bangkok Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Land and Houses and Bangkok Bank Public, you can compare the effects of market volatilities on Land and Bangkok Bank 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 Land with a short position of Bangkok Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Land and Bangkok Bank.
Diversification Opportunities for Land and Bangkok Bank
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Land and Bangkok is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Land and Houses and Bangkok Bank Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bangkok Bank Public and Land 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 Land and Houses are associated (or correlated) with Bangkok Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bangkok Bank Public has no effect on the direction of Land i.e., Land and Bangkok Bank go up and down completely randomly.
Pair Corralation between Land and Bangkok Bank
Assuming the 90 days horizon Land and Houses is expected to under-perform the Bangkok Bank. In addition to that, Land is 1.24 times more volatile than Bangkok Bank Public. It trades about -0.24 of its total potential returns per unit of risk. Bangkok Bank Public is currently generating about 0.04 per unit of volatility. If you would invest 15,250 in Bangkok Bank Public on November 4, 2024 and sell it today you would earn a total of 150.00 from holding Bangkok Bank Public or generate 0.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Land and Houses vs. Bangkok Bank Public
Performance |
| Timeline |
| Land and Houses |
| Bangkok Bank Public |
Land and Bangkok Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Land and Bangkok Bank
The main advantage of trading using opposite Land and Bangkok Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Land position performs unexpectedly, Bangkok Bank 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 Bangkok Bank will offset losses from the drop in Bangkok Bank's long position.The idea behind Land and Houses and Bangkok Bank Public pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Bangkok Bank vs. SCB X Public | Bangkok Bank vs. Kasikornbank Public | Bangkok Bank vs. PTT Public | Bangkok Bank vs. The Siam Cement |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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