Correlation Between Mahachai Hospital and Ekachai Medical
Can any of the company-specific risk be diversified away by investing in both Mahachai Hospital and Ekachai Medical 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 Mahachai Hospital and Ekachai Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mahachai Hospital Public and Ekachai Medical Care, you can compare the effects of market volatilities on Mahachai Hospital and Ekachai Medical 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 Mahachai Hospital with a short position of Ekachai Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mahachai Hospital and Ekachai Medical.
Diversification Opportunities for Mahachai Hospital and Ekachai Medical
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Mahachai and Ekachai is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Mahachai Hospital Public and Ekachai Medical Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ekachai Medical Care and Mahachai Hospital 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 Mahachai Hospital Public are associated (or correlated) with Ekachai Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ekachai Medical Care has no effect on the direction of Mahachai Hospital i.e., Mahachai Hospital and Ekachai Medical go up and down completely randomly.
Pair Corralation between Mahachai Hospital and Ekachai Medical
Assuming the 90 days trading horizon Mahachai Hospital Public is expected to under-perform the Ekachai Medical. In addition to that, Mahachai Hospital is 1.82 times more volatile than Ekachai Medical Care. It trades about -0.3 of its total potential returns per unit of risk. Ekachai Medical Care is currently generating about -0.11 per unit of volatility. If you would invest 665.00 in Ekachai Medical Care on August 30, 2024 and sell it today you would lose (15.00) from holding Ekachai Medical Care or give up 2.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Mahachai Hospital Public vs. Ekachai Medical Care
Performance |
| Timeline |
| Mahachai Hospital Public |
| Ekachai Medical Care |
Mahachai Hospital and Ekachai Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mahachai Hospital and Ekachai Medical
The main advantage of trading using opposite Mahachai Hospital and Ekachai Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mahachai Hospital position performs unexpectedly, Ekachai Medical 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 Ekachai Medical will offset losses from the drop in Ekachai Medical's long position.| Mahachai Hospital vs. Ladprao General Hospital | Mahachai Hospital vs. Nonthavej Hospital Public | Mahachai Hospital vs. Wattana Karnpaet Public | Mahachai Hospital vs. Thonburi Medical Centre |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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