Correlation Between Praram 9 and TRV Rubber
Can any of the company-specific risk be diversified away by investing in both Praram 9 and TRV Rubber 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 Praram 9 and TRV Rubber into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Praram 9 Hospital and TRV Rubber Products, you can compare the effects of market volatilities on Praram 9 and TRV Rubber 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 Praram 9 with a short position of TRV Rubber. Check out your portfolio center. Please also check ongoing floating volatility patterns of Praram 9 and TRV Rubber.
Diversification Opportunities for Praram 9 and TRV Rubber
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Praram and TRV is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Praram 9 Hospital and TRV Rubber Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRV Rubber Products and Praram 9 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 Praram 9 Hospital are associated (or correlated) with TRV Rubber. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRV Rubber Products has no effect on the direction of Praram 9 i.e., Praram 9 and TRV Rubber go up and down completely randomly.
Pair Corralation between Praram 9 and TRV Rubber
Assuming the 90 days trading horizon Praram 9 Hospital is expected to generate 0.37 times more return on investment than TRV Rubber. However, Praram 9 Hospital is 2.68 times less risky than TRV Rubber. It trades about 0.15 of its potential returns per unit of risk. TRV Rubber Products is currently generating about -0.01 per unit of risk. If you would invest 1,468 in Praram 9 Hospital on September 3, 2024 and sell it today you would earn a total of 1,107 from holding Praram 9 Hospital or generate 75.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 92.92% |
| Values | Daily Returns |
Praram 9 Hospital vs. TRV Rubber Products
Performance |
| Timeline |
| Praram 9 Hospital |
| TRV Rubber Products |
Praram 9 and TRV Rubber Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Praram 9 and TRV Rubber
The main advantage of trading using opposite Praram 9 and TRV Rubber positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Praram 9 position performs unexpectedly, TRV Rubber 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 TRV Rubber will offset losses from the drop in TRV Rubber's long position.| Praram 9 vs. Bangkok Dusit Medical | Praram 9 vs. Bangkok Dusit Medical | Praram 9 vs. Bangkok Chain Hospital | Praram 9 vs. Chularat Hospital Public |
| TRV Rubber vs. PMC LABEL MATERIALS | TRV Rubber vs. Charoen Pokphand Foods | TRV Rubber vs. Sri panwa Hospitality | TRV Rubber vs. Ramkhamhaeng Hospital 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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