Correlation Between PTT Public and Hana Microelectronics
Can any of the company-specific risk be diversified away by investing in both PTT Public and Hana Microelectronics 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 Hana Microelectronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PTT Public and Hana Microelectronics Public, you can compare the effects of market volatilities on PTT Public and Hana Microelectronics 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 Hana Microelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of PTT Public and Hana Microelectronics.
Diversification Opportunities for PTT Public and Hana Microelectronics
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PTT and Hana is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding PTT Public and Hana Microelectronics Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hana Microelectronics 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 Hana Microelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hana Microelectronics has no effect on the direction of PTT Public i.e., PTT Public and Hana Microelectronics go up and down completely randomly.
Pair Corralation between PTT Public and Hana Microelectronics
Assuming the 90 days trading horizon PTT Public is expected to generate 0.28 times more return on investment than Hana Microelectronics. However, PTT Public is 3.57 times less risky than Hana Microelectronics. It trades about -0.13 of its potential returns per unit of risk. Hana Microelectronics Public is currently generating about -0.38 per unit of risk. If you would invest 3,425 in PTT Public on August 28, 2024 and sell it today you would lose (100.00) from holding PTT Public or give up 2.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PTT Public vs. Hana Microelectronics Public
Performance |
| Timeline |
| PTT Public |
| Hana Microelectronics |
PTT Public and Hana Microelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PTT Public and Hana Microelectronics
The main advantage of trading using opposite PTT Public and Hana Microelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PTT Public position performs unexpectedly, Hana Microelectronics 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 Hana Microelectronics will offset losses from the drop in Hana Microelectronics' long position.The idea behind PTT Public and Hana Microelectronics Public pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Hana Microelectronics vs. KCE Electronics Public | Hana Microelectronics vs. Land and Houses | Hana Microelectronics vs. Delta Electronics Public | Hana Microelectronics vs. The Siam Cement |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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