Correlation Between LPN Development and MBK Public
Can any of the company-specific risk be diversified away by investing in both LPN Development and MBK 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 LPN Development and MBK Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LPN Development Public and MBK Public, you can compare the effects of market volatilities on LPN Development and MBK 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 LPN Development with a short position of MBK Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of LPN Development and MBK Public.
Diversification Opportunities for LPN Development and MBK Public
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between LPN and MBK is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding LPN Development Public and MBK Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MBK Public and LPN Development 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 LPN Development Public are associated (or correlated) with MBK Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MBK Public has no effect on the direction of LPN Development i.e., LPN Development and MBK Public go up and down completely randomly.
Pair Corralation between LPN Development and MBK Public
Assuming the 90 days trading horizon LPN Development Public is expected to generate 33.07 times more return on investment than MBK Public. However, LPN Development is 33.07 times more volatile than MBK Public. It trades about 0.05 of its potential returns per unit of risk. MBK Public is currently generating about 0.04 per unit of risk. If you would invest 373.00 in LPN Development Public on November 3, 2024 and sell it today you would lose (153.00) from holding LPN Development Public or give up 41.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.59% |
| Values | Daily Returns |
LPN Development Public vs. MBK Public
Performance |
| Timeline |
| LPN Development Public |
| MBK Public |
LPN Development and MBK Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LPN Development and MBK Public
The main advantage of trading using opposite LPN Development and MBK Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LPN Development position performs unexpectedly, MBK 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 MBK Public will offset losses from the drop in MBK Public's long position.| LPN Development vs. Land and Houses | LPN Development vs. AP Public | LPN Development vs. Quality Houses Public | LPN Development vs. Siri Prime Office |
| MBK Public vs. Land and Houses | MBK Public vs. Central Pattana Public | MBK Public vs. AP Public | MBK Public vs. Quality Houses 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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