Correlation Between MCS Steel and CIMB Thai
Can any of the company-specific risk be diversified away by investing in both MCS Steel and CIMB Thai 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 MCS Steel and CIMB Thai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MCS Steel Public and CIMB Thai Bank, you can compare the effects of market volatilities on MCS Steel and CIMB Thai 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 MCS Steel with a short position of CIMB Thai. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCS Steel and CIMB Thai.
Diversification Opportunities for MCS Steel and CIMB Thai
Weak diversification
The 3 months correlation between MCS and CIMB is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding MCS Steel Public and CIMB Thai Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIMB Thai Bank and MCS Steel 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 MCS Steel Public are associated (or correlated) with CIMB Thai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIMB Thai Bank has no effect on the direction of MCS Steel i.e., MCS Steel and CIMB Thai go up and down completely randomly.
Pair Corralation between MCS Steel and CIMB Thai
Assuming the 90 days trading horizon MCS Steel Public is expected to generate 0.65 times more return on investment than CIMB Thai. However, MCS Steel Public is 1.53 times less risky than CIMB Thai. It trades about -0.34 of its potential returns per unit of risk. CIMB Thai Bank is currently generating about -0.48 per unit of risk. If you would invest 735.00 in MCS Steel Public on September 13, 2024 and sell it today you would lose (45.00) from holding MCS Steel Public or give up 6.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MCS Steel Public vs. CIMB Thai Bank
Performance |
| Timeline |
| MCS Steel Public |
| CIMB Thai Bank |
MCS Steel and CIMB Thai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MCS Steel and CIMB Thai
The main advantage of trading using opposite MCS Steel and CIMB Thai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCS Steel position performs unexpectedly, CIMB Thai 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 CIMB Thai will offset losses from the drop in CIMB Thai's long position.| MCS Steel vs. Lalin Property Public | MCS Steel vs. Land and Houses | MCS Steel vs. Banpu Public | MCS Steel vs. TISCO Financial Group |
| CIMB Thai vs. KGI Securities Public | CIMB Thai vs. Lalin Property Public | CIMB Thai vs. Hwa Fong Rubber | CIMB Thai vs. MCS Steel 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |