Correlation Between Major Cineplex and Central Pattana
Can any of the company-specific risk be diversified away by investing in both Major Cineplex and Central Pattana 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 Major Cineplex and Central Pattana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Major Cineplex Lifestyle and Central Pattana Public, you can compare the effects of market volatilities on Major Cineplex and Central Pattana 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 Major Cineplex with a short position of Central Pattana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Major Cineplex and Central Pattana.
Diversification Opportunities for Major Cineplex and Central Pattana
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Major and Central is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Major Cineplex Lifestyle and Central Pattana Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Central Pattana Public and Major Cineplex 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 Major Cineplex Lifestyle are associated (or correlated) with Central Pattana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Central Pattana Public has no effect on the direction of Major Cineplex i.e., Major Cineplex and Central Pattana go up and down completely randomly.
Pair Corralation between Major Cineplex and Central Pattana
Assuming the 90 days trading horizon Major Cineplex Lifestyle is expected to generate 0.66 times more return on investment than Central Pattana. However, Major Cineplex Lifestyle is 1.52 times less risky than Central Pattana. It trades about -0.02 of its potential returns per unit of risk. Central Pattana Public is currently generating about -0.08 per unit of risk. If you would invest 416.00 in Major Cineplex Lifestyle on August 27, 2024 and sell it today you would lose (2.00) from holding Major Cineplex Lifestyle or give up 0.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Major Cineplex Lifestyle vs. Central Pattana Public
Performance |
| Timeline |
| Major Cineplex Lifestyle |
| Central Pattana Public |
Major Cineplex and Central Pattana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Major Cineplex and Central Pattana
The main advantage of trading using opposite Major Cineplex and Central Pattana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Major Cineplex position performs unexpectedly, Central Pattana 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 Central Pattana will offset losses from the drop in Central Pattana's long position.| Major Cineplex vs. Central Pattana Public | Major Cineplex vs. Digital Telecommunications Infrastructure | Major Cineplex vs. Impact Growth REIT | Major Cineplex vs. WHA Premium Growth |
| Central Pattana vs. CP ALL Public | Central Pattana vs. Bangkok Dusit Medical | Central Pattana vs. Airports of Thailand | Central Pattana vs. Advanced Info Service |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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