Correlation Between Lohakit Metal and Central Plaza
Can any of the company-specific risk be diversified away by investing in both Lohakit Metal and Central Plaza 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 Central Plaza 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 Central Plaza Hotel, you can compare the effects of market volatilities on Lohakit Metal and Central Plaza 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 Central Plaza. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lohakit Metal and Central Plaza.
Diversification Opportunities for Lohakit Metal and Central Plaza
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lohakit and Central is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Lohakit Metal Public and Central Plaza Hotel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Central Plaza Hotel 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 Central Plaza. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Central Plaza Hotel has no effect on the direction of Lohakit Metal i.e., Lohakit Metal and Central Plaza go up and down completely randomly.
Pair Corralation between Lohakit Metal and Central Plaza
Assuming the 90 days trading horizon Lohakit Metal Public is expected to generate 0.57 times more return on investment than Central Plaza. However, Lohakit Metal Public is 1.75 times less risky than Central Plaza. It trades about -0.02 of its potential returns per unit of risk. Central Plaza Hotel is currently generating about -0.02 per unit of risk. If you would invest 437.00 in Lohakit Metal Public on September 3, 2024 and sell it today you would lose (61.00) from holding Lohakit Metal Public or give up 13.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lohakit Metal Public vs. Central Plaza Hotel
Performance |
| Timeline |
| Lohakit Metal Public |
| Central Plaza Hotel |
Lohakit Metal and Central Plaza Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lohakit Metal and Central Plaza
The main advantage of trading using opposite Lohakit Metal and Central Plaza positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lohakit Metal position performs unexpectedly, Central Plaza 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 Central Plaza will offset losses from the drop in Central Plaza's long position.| Lohakit Metal vs. Asia Aviation Public | Lohakit Metal vs. Bangkok Dusit Medical | Lohakit Metal vs. Bangkok Expressway and | Lohakit Metal vs. Airports of Thailand |
| Central Plaza vs. Central Pattana Public | Central Plaza vs. CP ALL Public | Central Plaza vs. Bangkok Dusit Medical | Central Plaza 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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