Correlation Between PTT Public and Home Product
Can any of the company-specific risk be diversified away by investing in both PTT Public and Home Product 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 Home Product into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PTT Public and Home Product Center, you can compare the effects of market volatilities on PTT Public and Home Product 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 Home Product. Check out your portfolio center. Please also check ongoing floating volatility patterns of PTT Public and Home Product.
Diversification Opportunities for PTT Public and Home Product
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between PTT and Home is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding PTT Public and Home Product Center in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Home Product Center 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 Home Product. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Home Product Center has no effect on the direction of PTT Public i.e., PTT Public and Home Product go up and down completely randomly.
Pair Corralation between PTT Public and Home Product
Assuming the 90 days trading horizon PTT Public is expected to generate 0.67 times more return on investment than Home Product. However, PTT Public is 1.5 times less risky than Home Product. It trades about 0.03 of its potential returns per unit of risk. Home Product Center is currently generating about -0.05 per unit of risk. If you would invest 2,926 in PTT Public on August 28, 2024 and sell it today you would earn a total of 399.00 from holding PTT Public or generate 13.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PTT Public vs. Home Product Center
Performance |
| Timeline |
| PTT Public |
| Home Product Center |
PTT Public and Home Product Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PTT Public and Home Product
The main advantage of trading using opposite PTT Public and Home Product positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PTT Public position performs unexpectedly, Home Product 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 Home Product will offset losses from the drop in Home Product's long position.| PTT Public vs. IRPC Public | PTT Public vs. PTT Oil and | PTT Public vs. Power Solution Technologies | PTT Public vs. Star Petroleum Refining |
| Home Product vs. SCB X Public | Home Product vs. Kasikornbank Public | Home Product vs. PTT Public | Home Product vs. Kasikornbank 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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