Correlation Between Lohakit Metal and Advanced Connection
Can any of the company-specific risk be diversified away by investing in both Lohakit Metal and Advanced Connection 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 Lohakit Metal and Advanced Connection into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lohakit Metal Public and Advanced Connection, you can compare the effects of market volatilities on Lohakit Metal and Advanced Connection 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 Lohakit Metal with a short position of Advanced Connection. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lohakit Metal and Advanced Connection.
Diversification Opportunities for Lohakit Metal and Advanced Connection
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Lohakit and Advanced is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Lohakit Metal Public and Advanced Connection in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advanced Connection and Lohakit Metal 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 Lohakit Metal Public are associated (or correlated) with Advanced Connection. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advanced Connection has no effect on the direction of Lohakit Metal i.e., Lohakit Metal and Advanced Connection go up and down completely randomly.
Pair Corralation between Lohakit Metal and Advanced Connection
Assuming the 90 days trading horizon Lohakit Metal is expected to generate 11.0 times less return on investment than Advanced Connection. But when comparing it to its historical volatility, Lohakit Metal Public is 7.43 times less risky than Advanced Connection. It trades about 0.09 of its potential returns per unit of risk. Advanced Connection is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 45.00 in Advanced Connection on September 2, 2024 and sell it today you would earn a total of 23.00 from holding Advanced Connection or generate 51.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lohakit Metal Public vs. Advanced Connection
Performance |
| Timeline |
| Lohakit Metal Public |
| Advanced Connection |
Lohakit Metal and Advanced Connection Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lohakit Metal and Advanced Connection
The main advantage of trading using opposite Lohakit Metal and Advanced Connection positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lohakit Metal position performs unexpectedly, Advanced Connection 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 Advanced Connection will offset losses from the drop in Advanced Connection's long position.| Lohakit Metal vs. Gulf Energy Development | Lohakit Metal vs. Energy Absolute Public | Lohakit Metal vs. WHA Public | Lohakit Metal vs. Bangkok Expressway and |
| Advanced Connection vs. Ekarat Engineering Public | Advanced Connection vs. Asia Green Energy | Advanced Connection vs. Better World Green | Advanced Connection vs. Aqua 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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