Correlation Between PTT Global and Tipco Asphalt
Can any of the company-specific risk be diversified away by investing in both PTT Global and Tipco Asphalt 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 Tipco Asphalt 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 Tipco Asphalt Public, you can compare the effects of market volatilities on PTT Global and Tipco Asphalt 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 Tipco Asphalt. Check out your portfolio center. Please also check ongoing floating volatility patterns of PTT Global and Tipco Asphalt.
Diversification Opportunities for PTT Global and Tipco Asphalt
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between PTT and Tipco is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding PTT Global Chemical and Tipco Asphalt Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tipco Asphalt 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 Tipco Asphalt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tipco Asphalt Public has no effect on the direction of PTT Global i.e., PTT Global and Tipco Asphalt go up and down completely randomly.
Pair Corralation between PTT Global and Tipco Asphalt
Assuming the 90 days trading horizon PTT Global Chemical is expected to generate 39.71 times more return on investment than Tipco Asphalt. However, PTT Global is 39.71 times more volatile than Tipco Asphalt Public. It trades about 0.04 of its potential returns per unit of risk. Tipco Asphalt Public is currently generating about 0.01 per unit of risk. If you would invest 4,168 in PTT Global Chemical on August 31, 2024 and sell it today you would lose (1,668) from holding PTT Global Chemical or give up 40.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PTT Global Chemical vs. Tipco Asphalt Public
Performance |
| Timeline |
| PTT Global Chemical |
| Tipco Asphalt Public |
PTT Global and Tipco Asphalt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PTT Global and Tipco Asphalt
The main advantage of trading using opposite PTT Global and Tipco Asphalt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PTT Global position performs unexpectedly, Tipco Asphalt 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 Tipco Asphalt will offset losses from the drop in Tipco Asphalt's long position.| PTT Global vs. PTT Public | PTT Global vs. PTT Exploration and | PTT Global vs. The Siam Cement | PTT Global vs. CP ALL Public |
| Tipco Asphalt vs. TISCO Financial Group | Tipco Asphalt vs. WHA Public | Tipco Asphalt vs. PTT Global Chemical | Tipco Asphalt vs. Charoen Pokphand Foods |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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