Correlation Between MK Restaurant and GFPT Public
Can any of the company-specific risk be diversified away by investing in both MK Restaurant and GFPT 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 MK Restaurant and GFPT Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MK Restaurant Group and GFPT Public, you can compare the effects of market volatilities on MK Restaurant and GFPT 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 MK Restaurant with a short position of GFPT Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of MK Restaurant and GFPT Public.
Diversification Opportunities for MK Restaurant and GFPT Public
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MK Restaurant and GFPT is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding MK Restaurant Group and GFPT Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GFPT Public and MK Restaurant 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 MK Restaurant Group are associated (or correlated) with GFPT Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GFPT Public has no effect on the direction of MK Restaurant i.e., MK Restaurant and GFPT Public go up and down completely randomly.
Pair Corralation between MK Restaurant and GFPT Public
Given the investment horizon of 90 days MK Restaurant Group is expected to generate 1.13 times more return on investment than GFPT Public. However, MK Restaurant is 1.13 times more volatile than GFPT Public. It trades about -0.04 of its potential returns per unit of risk. GFPT Public is currently generating about -0.15 per unit of risk. If you would invest 2,625 in MK Restaurant Group on September 2, 2024 and sell it today you would lose (145.00) from holding MK Restaurant Group or give up 5.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MK Restaurant Group vs. GFPT Public
Performance |
| Timeline |
| MK Restaurant Group |
| GFPT Public |
MK Restaurant and GFPT Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MK Restaurant and GFPT Public
The main advantage of trading using opposite MK Restaurant and GFPT Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MK Restaurant position performs unexpectedly, GFPT 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 GFPT Public will offset losses from the drop in GFPT Public's long position.| MK Restaurant vs. Minor International Public | MK Restaurant vs. Home Product Center | MK Restaurant vs. CP ALL Public | MK Restaurant vs. Central Pattana Public |
| GFPT Public vs. MK Restaurant Group | GFPT Public vs. TRC Construction Public | GFPT Public vs. Bangkok Expressway and | GFPT Public vs. Lohakit Metal 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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