Correlation Between LH Financial and PTT Public
Can any of the company-specific risk be diversified away by investing in both LH Financial and PTT 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 LH Financial and PTT Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LH Financial Group and PTT Public, you can compare the effects of market volatilities on LH Financial and PTT 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 LH Financial with a short position of PTT Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of LH Financial and PTT Public.
Diversification Opportunities for LH Financial and PTT Public
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between LHFG and PTT is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding LH Financial Group and PTT Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PTT Public and LH Financial 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 LH Financial Group are associated (or correlated) with PTT Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PTT Public has no effect on the direction of LH Financial i.e., LH Financial and PTT Public go up and down completely randomly.
Pair Corralation between LH Financial and PTT Public
Assuming the 90 days trading horizon LH Financial Group is expected to generate 43.76 times more return on investment than PTT Public. However, LH Financial is 43.76 times more volatile than PTT Public. It trades about 0.04 of its potential returns per unit of risk. PTT Public is currently generating about 0.02 per unit of risk. If you would invest 119.00 in LH Financial Group on September 3, 2024 and sell it today you would lose (38.00) from holding LH Financial Group or give up 31.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LH Financial Group vs. PTT Public
Performance |
| Timeline |
| LH Financial Group |
| PTT Public |
LH Financial and PTT Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LH Financial and PTT Public
The main advantage of trading using opposite LH Financial and PTT Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LH Financial position performs unexpectedly, PTT 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 PTT Public will offset losses from the drop in PTT Public's long position.| LH Financial vs. PTT Public | LH Financial vs. The Siam Commercial | LH Financial vs. CP ALL Public | LH Financial vs. SCB X Public |
| PTT Public vs. PTT Exploration and | PTT Public vs. The Siam Cement | PTT Public vs. CP ALL Public | PTT Public vs. Airports of Thailand |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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