Correlation Between OCC Public and Central Pattana
Can any of the company-specific risk be diversified away by investing in both OCC Public 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 OCC Public and Central Pattana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OCC Public and Central Pattana Public, you can compare the effects of market volatilities on OCC Public 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 OCC Public with a short position of Central Pattana. Check out your portfolio center. Please also check ongoing floating volatility patterns of OCC Public and Central Pattana.
Diversification Opportunities for OCC Public and Central Pattana
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between OCC and Central is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding OCC Public 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 OCC Public 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 OCC Public 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 OCC Public i.e., OCC Public and Central Pattana go up and down completely randomly.
Pair Corralation between OCC Public and Central Pattana
Assuming the 90 days trading horizon OCC Public is expected to generate 0.56 times more return on investment than Central Pattana. However, OCC Public is 1.8 times less risky than Central Pattana. It trades about -0.13 of its potential returns per unit of risk. Central Pattana Public is currently generating about -0.15 per unit of risk. If you would invest 920.00 in OCC Public on September 3, 2024 and sell it today you would lose (20.00) from holding OCC Public or give up 2.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
OCC Public vs. Central Pattana Public
Performance |
| Timeline |
| OCC Public |
| Central Pattana Public |
OCC Public and Central Pattana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OCC Public and Central Pattana
The main advantage of trading using opposite OCC Public and Central Pattana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OCC Public 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.| OCC Public vs. Central Pattana Public | OCC Public vs. CP ALL Public | OCC Public vs. Bangkok Dusit Medical | OCC Public vs. Airports of Thailand |
| 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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