Correlation Between Polski Koncern and BANGCHAK P
Can any of the company-specific risk be diversified away by investing in both Polski Koncern and BANGCHAK P 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 Polski Koncern and BANGCHAK P into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Polski Koncern Naftowy and BANGCHAK P FGN , you can compare the effects of market volatilities on Polski Koncern and BANGCHAK P 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 Polski Koncern with a short position of BANGCHAK P. Check out your portfolio center. Please also check ongoing floating volatility patterns of Polski Koncern and BANGCHAK P.
Diversification Opportunities for Polski Koncern and BANGCHAK P
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Polski and BANGCHAK is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Polski Koncern Naftowy and BANGCHAK P FGN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANGCHAK P FGN and Polski Koncern 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 Polski Koncern Naftowy are associated (or correlated) with BANGCHAK P. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANGCHAK P FGN has no effect on the direction of Polski Koncern i.e., Polski Koncern and BANGCHAK P go up and down completely randomly.
Pair Corralation between Polski Koncern and BANGCHAK P
Assuming the 90 days trading horizon Polski Koncern Naftowy is expected to generate 0.65 times more return on investment than BANGCHAK P. However, Polski Koncern Naftowy is 1.53 times less risky than BANGCHAK P. It trades about -0.1 of its potential returns per unit of risk. BANGCHAK P FGN is currently generating about -0.12 per unit of risk. If you would invest 1,174 in Polski Koncern Naftowy on September 21, 2024 and sell it today you would lose (60.00) from holding Polski Koncern Naftowy or give up 5.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Polski Koncern Naftowy vs. BANGCHAK P FGN
Performance |
| Timeline |
| Polski Koncern Naftowy |
| BANGCHAK P FGN |
Polski Koncern and BANGCHAK P Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Polski Koncern and BANGCHAK P
The main advantage of trading using opposite Polski Koncern and BANGCHAK P positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polski Koncern position performs unexpectedly, BANGCHAK P 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 BANGCHAK P will offset losses from the drop in BANGCHAK P's long position.| Polski Koncern vs. National Beverage Corp | Polski Koncern vs. THAI BEVERAGE | Polski Koncern vs. Molson Coors Beverage | Polski Koncern vs. Dairy Farm International |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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