Correlation Between PTT Global and Forth Public
Can any of the company-specific risk be diversified away by investing in both PTT Global and Forth Public 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 Global and Forth Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PTT Global Chemical and Forth Public, you can compare the effects of market volatilities on PTT Global and Forth Public 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 Global with a short position of Forth Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of PTT Global and Forth Public.
Diversification Opportunities for PTT Global and Forth Public
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PTT and Forth is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding PTT Global Chemical and Forth Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Forth Public and PTT Global 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 Global Chemical are associated (or correlated) with Forth Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Forth Public has no effect on the direction of PTT Global i.e., PTT Global and Forth Public go up and down completely randomly.
Pair Corralation between PTT Global and Forth Public
Assuming the 90 days trading horizon PTT Global Chemical is expected to generate 13.45 times more return on investment than Forth Public. However, PTT Global is 13.45 times more volatile than Forth Public. It trades about 0.04 of its potential returns per unit of risk. Forth Public is currently generating about -0.04 per unit of risk. If you would invest 4,365 in PTT Global Chemical on September 12, 2024 and sell it today you would lose (1,875) from holding PTT Global Chemical or give up 42.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PTT Global Chemical vs. Forth Public
Performance |
| Timeline |
| PTT Global Chemical |
| Forth Public |
PTT Global and Forth Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PTT Global and Forth Public
The main advantage of trading using opposite PTT Global and Forth Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PTT Global position performs unexpectedly, Forth Public 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 Forth Public will offset losses from the drop in Forth Public's long position.| PTT Global vs. Thantawan Industry Public | PTT Global vs. The Erawan Group | PTT Global vs. Jay Mart Public | PTT Global vs. Airports of Thailand |
| Forth Public vs. PTT Global Chemical | Forth Public vs. Dohome Public | Forth Public vs. The Navakij Insurance | Forth Public vs. Pato Chemical Industry |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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