Correlation Between Namyong Terminal and Eastern Technical
Can any of the company-specific risk be diversified away by investing in both Namyong Terminal and Eastern Technical 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 Namyong Terminal and Eastern Technical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Namyong Terminal PCL and Eastern Technical Engineering, you can compare the effects of market volatilities on Namyong Terminal and Eastern Technical 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 Namyong Terminal with a short position of Eastern Technical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Namyong Terminal and Eastern Technical.
Diversification Opportunities for Namyong Terminal and Eastern Technical
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Namyong and Eastern is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Namyong Terminal PCL and Eastern Technical Engineering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastern Technical and Namyong Terminal 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 Namyong Terminal PCL are associated (or correlated) with Eastern Technical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastern Technical has no effect on the direction of Namyong Terminal i.e., Namyong Terminal and Eastern Technical go up and down completely randomly.
Pair Corralation between Namyong Terminal and Eastern Technical
Assuming the 90 days trading horizon Namyong Terminal PCL is expected to generate 0.65 times more return on investment than Eastern Technical. However, Namyong Terminal PCL is 1.53 times less risky than Eastern Technical. It trades about 0.26 of its potential returns per unit of risk. Eastern Technical Engineering is currently generating about 0.01 per unit of risk. If you would invest 292.00 in Namyong Terminal PCL on October 20, 2024 and sell it today you would earn a total of 24.00 from holding Namyong Terminal PCL or generate 8.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Namyong Terminal PCL vs. Eastern Technical Engineering
Performance |
| Timeline |
| Namyong Terminal PCL |
| Eastern Technical |
Namyong Terminal and Eastern Technical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Namyong Terminal and Eastern Technical
The main advantage of trading using opposite Namyong Terminal and Eastern Technical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Namyong Terminal position performs unexpectedly, Eastern Technical 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 Eastern Technical will offset losses from the drop in Eastern Technical's long position.| Namyong Terminal vs. Super Energy | Namyong Terminal vs. RPCG Public | Namyong Terminal vs. Thoresen Thai Agencies | Namyong Terminal vs. Precious Shipping Public |
| Eastern Technical vs. G Capital Public | Eastern Technical vs. Harn Engineering Solutions | Eastern Technical vs. Fortune Parts Industry | Eastern Technical vs. Hydrotek 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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