Correlation Between Mega Lifesciences and Singer Thailand
Can any of the company-specific risk be diversified away by investing in both Mega Lifesciences and Singer Thailand 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 Mega Lifesciences and Singer Thailand into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mega Lifesciences Public and Singer Thailand Public, you can compare the effects of market volatilities on Mega Lifesciences and Singer Thailand 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 Mega Lifesciences with a short position of Singer Thailand. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mega Lifesciences and Singer Thailand.
Diversification Opportunities for Mega Lifesciences and Singer Thailand
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Mega and Singer is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Mega Lifesciences Public and Singer Thailand Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singer Thailand Public and Mega Lifesciences 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 Mega Lifesciences Public are associated (or correlated) with Singer Thailand. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Singer Thailand Public has no effect on the direction of Mega Lifesciences i.e., Mega Lifesciences and Singer Thailand go up and down completely randomly.
Pair Corralation between Mega Lifesciences and Singer Thailand
Assuming the 90 days trading horizon Mega Lifesciences Public is expected to generate 0.66 times more return on investment than Singer Thailand. However, Mega Lifesciences Public is 1.51 times less risky than Singer Thailand. It trades about -0.28 of its potential returns per unit of risk. Singer Thailand Public is currently generating about -0.29 per unit of risk. If you would invest 3,950 in Mega Lifesciences Public on September 1, 2024 and sell it today you would lose (425.00) from holding Mega Lifesciences Public or give up 10.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Mega Lifesciences Public vs. Singer Thailand Public
Performance |
| Timeline |
| Mega Lifesciences Public |
| Singer Thailand Public |
Mega Lifesciences and Singer Thailand Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mega Lifesciences and Singer Thailand
The main advantage of trading using opposite Mega Lifesciences and Singer Thailand positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mega Lifesciences position performs unexpectedly, Singer Thailand 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 Singer Thailand will offset losses from the drop in Singer Thailand's long position.| Mega Lifesciences vs. Home Product Center | Mega Lifesciences vs. Minor International Public | Mega Lifesciences vs. Com7 PCL | Mega Lifesciences vs. Bangkok Dusit Medical |
| Singer Thailand vs. Jay Mart Public | Singer Thailand vs. JMT Network Services | Singer Thailand vs. KCE Electronics Public | Singer Thailand vs. Srisawad Power 1979 |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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