Correlation Between Nawarat Patanakarn and Ocean Glass
Can any of the company-specific risk be diversified away by investing in both Nawarat Patanakarn and Ocean Glass 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 Nawarat Patanakarn and Ocean Glass into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nawarat Patanakarn Public and Ocean Glass Public, you can compare the effects of market volatilities on Nawarat Patanakarn and Ocean Glass 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 Nawarat Patanakarn with a short position of Ocean Glass. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nawarat Patanakarn and Ocean Glass.
Diversification Opportunities for Nawarat Patanakarn and Ocean Glass
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Nawarat and Ocean is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Nawarat Patanakarn Public and Ocean Glass Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ocean Glass Public and Nawarat Patanakarn 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 Nawarat Patanakarn Public are associated (or correlated) with Ocean Glass. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ocean Glass Public has no effect on the direction of Nawarat Patanakarn i.e., Nawarat Patanakarn and Ocean Glass go up and down completely randomly.
Pair Corralation between Nawarat Patanakarn and Ocean Glass
Assuming the 90 days trading horizon Nawarat Patanakarn Public is expected to under-perform the Ocean Glass. In addition to that, Nawarat Patanakarn is 2.46 times more volatile than Ocean Glass Public. It trades about -0.28 of its total potential returns per unit of risk. Ocean Glass Public is currently generating about -0.49 per unit of volatility. If you would invest 2,250 in Ocean Glass Public on September 1, 2024 and sell it today you would lose (350.00) from holding Ocean Glass Public or give up 15.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Nawarat Patanakarn Public vs. Ocean Glass Public
Performance |
| Timeline |
| Nawarat Patanakarn Public |
| Ocean Glass Public |
Nawarat Patanakarn and Ocean Glass Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nawarat Patanakarn and Ocean Glass
The main advantage of trading using opposite Nawarat Patanakarn and Ocean Glass positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nawarat Patanakarn position performs unexpectedly, Ocean Glass 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 Ocean Glass will offset losses from the drop in Ocean Glass' long position.| Nawarat Patanakarn vs. Gulf Energy Development | Nawarat Patanakarn vs. Energy Absolute Public | Nawarat Patanakarn vs. WHA Public | Nawarat Patanakarn vs. Bangkok Expressway and |
| Ocean Glass vs. TRC Construction Public | Ocean Glass vs. Bangkok Expressway and | Ocean Glass vs. Lohakit Metal Public | Ocean Glass vs. Gunkul Engineering 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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