Correlation Between PTT Public and Delta Electronics
Can any of the company-specific risk be diversified away by investing in both PTT Public and Delta Electronics 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 PTT Public and Delta Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PTT Public and Delta Electronics Public, you can compare the effects of market volatilities on PTT Public and Delta Electronics 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 PTT Public with a short position of Delta Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of PTT Public and Delta Electronics.
Diversification Opportunities for PTT Public and Delta Electronics
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PTT and Delta is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding PTT Public and Delta Electronics Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delta Electronics Public and PTT 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 PTT Public are associated (or correlated) with Delta Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delta Electronics Public has no effect on the direction of PTT Public i.e., PTT Public and Delta Electronics go up and down completely randomly.
Pair Corralation between PTT Public and Delta Electronics
Assuming the 90 days trading horizon PTT Public is expected to under-perform the Delta Electronics. But the stock apears to be less risky and, when comparing its historical volatility, PTT Public is 4.38 times less risky than Delta Electronics. The stock trades about -0.13 of its potential returns per unit of risk. The Delta Electronics Public is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 12,700 in Delta Electronics Public on August 28, 2024 and sell it today you would earn a total of 1,850 from holding Delta Electronics Public or generate 14.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PTT Public vs. Delta Electronics Public
Performance |
| Timeline |
| PTT Public |
| Delta Electronics Public |
PTT Public and Delta Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PTT Public and Delta Electronics
The main advantage of trading using opposite PTT Public and Delta Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PTT Public position performs unexpectedly, Delta Electronics 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 Delta Electronics will offset losses from the drop in Delta Electronics' long position.| PTT Public vs. PTT Exploration and | PTT Public vs. The Siam Cement | PTT Public vs. CP ALL Public | PTT Public vs. Airports of Thailand |
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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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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