Correlation Between PTT Global and Union Petrochemical
Can any of the company-specific risk be diversified away by investing in both PTT Global and Union Petrochemical 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 Union Petrochemical 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 Union Petrochemical Public, you can compare the effects of market volatilities on PTT Global and Union Petrochemical 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 Union Petrochemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of PTT Global and Union Petrochemical.
Diversification Opportunities for PTT Global and Union Petrochemical
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between PTT and Union is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding PTT Global Chemical and Union Petrochemical Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Union Petrochemical 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 Union Petrochemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Union Petrochemical has no effect on the direction of PTT Global i.e., PTT Global and Union Petrochemical go up and down completely randomly.
Pair Corralation between PTT Global and Union Petrochemical
Assuming the 90 days trading horizon PTT Global Chemical is expected to generate 1.12 times more return on investment than Union Petrochemical. However, PTT Global is 1.12 times more volatile than Union Petrochemical Public. It trades about -0.05 of its potential returns per unit of risk. Union Petrochemical Public is currently generating about -0.21 per unit of risk. If you would invest 2,600 in PTT Global Chemical on September 1, 2024 and sell it today you would lose (75.00) from holding PTT Global Chemical or give up 2.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
PTT Global Chemical vs. Union Petrochemical Public
Performance |
| Timeline |
| PTT Global Chemical |
| Union Petrochemical |
PTT Global and Union Petrochemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PTT Global and Union Petrochemical
The main advantage of trading using opposite PTT Global and Union Petrochemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PTT Global position performs unexpectedly, Union Petrochemical 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 Union Petrochemical will offset losses from the drop in Union Petrochemical's long position.| PTT Global vs. AAPICO Hitech Public | PTT Global vs. AP Public | PTT Global vs. Aikchol Hospital Public | PTT Global vs. Bank of Ayudhya |
| Union Petrochemical vs. Vibhavadi Medical Center | Union Petrochemical vs. TWZ Public | Union Petrochemical vs. WHA Public | Union Petrochemical vs. Tata Steel 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |