Correlation Between Pan Asia and Peoples Garment
Can any of the company-specific risk be diversified away by investing in both Pan Asia and Peoples Garment 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 Pan Asia and Peoples Garment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pan Asia Footwear and Peoples Garment Public, you can compare the effects of market volatilities on Pan Asia and Peoples Garment 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 Pan Asia with a short position of Peoples Garment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pan Asia and Peoples Garment.
Diversification Opportunities for Pan Asia and Peoples Garment
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Pan and Peoples is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Pan Asia Footwear and Peoples Garment Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peoples Garment Public and Pan Asia 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 Pan Asia Footwear are associated (or correlated) with Peoples Garment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peoples Garment Public has no effect on the direction of Pan Asia i.e., Pan Asia and Peoples Garment go up and down completely randomly.
Pair Corralation between Pan Asia and Peoples Garment
Assuming the 90 days trading horizon Pan Asia Footwear is expected to under-perform the Peoples Garment. In addition to that, Pan Asia is 5.61 times more volatile than Peoples Garment Public. It trades about -0.15 of its total potential returns per unit of risk. Peoples Garment Public is currently generating about 0.08 per unit of volatility. If you would invest 890.00 in Peoples Garment Public on September 1, 2024 and sell it today you would earn a total of 5.00 from holding Peoples Garment Public or generate 0.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Pan Asia Footwear vs. Peoples Garment Public
Performance |
| Timeline |
| Pan Asia Footwear |
| Peoples Garment Public |
Pan Asia and Peoples Garment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pan Asia and Peoples Garment
The main advantage of trading using opposite Pan Asia and Peoples Garment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pan Asia position performs unexpectedly, Peoples Garment 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 Peoples Garment will offset losses from the drop in Peoples Garment's long position.| Pan Asia vs. TRC Construction Public | Pan Asia vs. Bangkok Expressway and | Pan Asia vs. Lohakit Metal Public | Pan Asia vs. Gunkul Engineering Public |
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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