Correlation Between PTT PCL and Shell PLC
Can any of the company-specific risk be diversified away by investing in both PTT PCL and Shell PLC 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 PCL and Shell PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PTT PCL ADR and Shell PLC ADR, you can compare the effects of market volatilities on PTT PCL and Shell PLC 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 PCL with a short position of Shell PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of PTT PCL and Shell PLC.
Diversification Opportunities for PTT PCL and Shell PLC
Very good diversification
The 3 months correlation between PTT and Shell is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding PTT PCL ADR and Shell PLC ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shell PLC ADR and PTT PCL 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 PCL ADR are associated (or correlated) with Shell PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shell PLC ADR has no effect on the direction of PTT PCL i.e., PTT PCL and Shell PLC go up and down completely randomly.
Pair Corralation between PTT PCL and Shell PLC
If you would invest 6,310 in Shell PLC ADR on November 2, 2024 and sell it today you would earn a total of 355.00 from holding Shell PLC ADR or generate 5.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.48% |
| Values | Daily Returns |
PTT PCL ADR vs. Shell PLC ADR
Performance |
| Timeline |
| PTT PCL ADR |
| Shell PLC ADR |
PTT PCL and Shell PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PTT PCL and Shell PLC
The main advantage of trading using opposite PTT PCL and Shell PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PTT PCL position performs unexpectedly, Shell PLC 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 Shell PLC will offset losses from the drop in Shell PLC's long position.The idea behind PTT PCL ADR and Shell PLC ADR pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Shell PLC vs. Exxon Mobil Corp | Shell PLC vs. Chevron Corp | Shell PLC vs. TotalEnergies SE ADR | Shell PLC vs. Petroleo Brasileiro Petrobras |
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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