Correlation Between PTT Exploration and Millcon Steel
Can any of the company-specific risk be diversified away by investing in both PTT Exploration and Millcon Steel 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 Exploration and Millcon Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PTT Exploration and and Millcon Steel Public, you can compare the effects of market volatilities on PTT Exploration and Millcon Steel 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 Exploration with a short position of Millcon Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of PTT Exploration and Millcon Steel.
Diversification Opportunities for PTT Exploration and Millcon Steel
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between PTT and Millcon is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding PTT Exploration and and Millcon Steel Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Millcon Steel Public and PTT Exploration 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 Exploration and are associated (or correlated) with Millcon Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Millcon Steel Public has no effect on the direction of PTT Exploration i.e., PTT Exploration and Millcon Steel go up and down completely randomly.
Pair Corralation between PTT Exploration and Millcon Steel
Assuming the 90 days trading horizon PTT Exploration and is expected to under-perform the Millcon Steel. But the stock apears to be less risky and, when comparing its historical volatility, PTT Exploration and is 31.57 times less risky than Millcon Steel. The stock trades about -0.02 of its potential returns per unit of risk. The Millcon Steel Public is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 77.00 in Millcon Steel Public on August 29, 2024 and sell it today you would lose (67.00) from holding Millcon Steel Public or give up 87.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PTT Exploration and vs. Millcon Steel Public
Performance |
| Timeline |
| PTT Exploration |
| Millcon Steel Public |
PTT Exploration and Millcon Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PTT Exploration and Millcon Steel
The main advantage of trading using opposite PTT Exploration and Millcon Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PTT Exploration position performs unexpectedly, Millcon Steel 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 Millcon Steel will offset losses from the drop in Millcon Steel's long position.| PTT Exploration vs. PTT Public | PTT Exploration vs. PTT Global Chemical | PTT Exploration vs. The Siam Cement | PTT Exploration vs. SCB X Public |
| Millcon Steel vs. PTT Public | Millcon Steel vs. PTT Exploration and | Millcon Steel vs. CP ALL Public | Millcon Steel 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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