Correlation Between NAT ABSOLUTE and Ramkhamhaeng Hospital
Can any of the company-specific risk be diversified away by investing in both NAT ABSOLUTE and Ramkhamhaeng Hospital 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 NAT ABSOLUTE and Ramkhamhaeng Hospital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NAT ABSOLUTE TECHNOLOGIES and Ramkhamhaeng Hospital Public, you can compare the effects of market volatilities on NAT ABSOLUTE and Ramkhamhaeng Hospital 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 NAT ABSOLUTE with a short position of Ramkhamhaeng Hospital. Check out your portfolio center. Please also check ongoing floating volatility patterns of NAT ABSOLUTE and Ramkhamhaeng Hospital.
Diversification Opportunities for NAT ABSOLUTE and Ramkhamhaeng Hospital
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between NAT and Ramkhamhaeng is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding NAT ABSOLUTE TECHNOLOGIES and Ramkhamhaeng Hospital Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ramkhamhaeng Hospital and NAT ABSOLUTE 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 NAT ABSOLUTE TECHNOLOGIES are associated (or correlated) with Ramkhamhaeng Hospital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ramkhamhaeng Hospital has no effect on the direction of NAT ABSOLUTE i.e., NAT ABSOLUTE and Ramkhamhaeng Hospital go up and down completely randomly.
Pair Corralation between NAT ABSOLUTE and Ramkhamhaeng Hospital
Assuming the 90 days trading horizon NAT ABSOLUTE TECHNOLOGIES is expected to under-perform the Ramkhamhaeng Hospital. In addition to that, NAT ABSOLUTE is 1.02 times more volatile than Ramkhamhaeng Hospital Public. It trades about -0.47 of its total potential returns per unit of risk. Ramkhamhaeng Hospital Public is currently generating about -0.08 per unit of volatility. If you would invest 2,365 in Ramkhamhaeng Hospital Public on August 29, 2024 and sell it today you would lose (45.00) from holding Ramkhamhaeng Hospital Public or give up 1.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NAT ABSOLUTE TECHNOLOGIES vs. Ramkhamhaeng Hospital Public
Performance |
| Timeline |
| NAT ABSOLUTE TECHNOLOGIES |
| Ramkhamhaeng Hospital |
NAT ABSOLUTE and Ramkhamhaeng Hospital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NAT ABSOLUTE and Ramkhamhaeng Hospital
The main advantage of trading using opposite NAT ABSOLUTE and Ramkhamhaeng Hospital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NAT ABSOLUTE position performs unexpectedly, Ramkhamhaeng Hospital 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 Ramkhamhaeng Hospital will offset losses from the drop in Ramkhamhaeng Hospital's long position.| NAT ABSOLUTE vs. Delta Electronics Public | NAT ABSOLUTE vs. Delta Electronics Public | NAT ABSOLUTE vs. Airports of Thailand | NAT ABSOLUTE vs. Airports of Thailand |
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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