Correlation Between Pylon Public and Airports
Can any of the company-specific risk be diversified away by investing in both Pylon Public and Airports 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 Pylon Public and Airports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pylon Public and Airports of Thailand, you can compare the effects of market volatilities on Pylon Public and Airports 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 Pylon Public with a short position of Airports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pylon Public and Airports.
Diversification Opportunities for Pylon Public and Airports
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pylon and Airports is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Pylon Public and Airports of Thailand in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airports of Thailand and Pylon Public 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 Pylon Public are associated (or correlated) with Airports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airports of Thailand has no effect on the direction of Pylon Public i.e., Pylon Public and Airports go up and down completely randomly.
Pair Corralation between Pylon Public and Airports
Assuming the 90 days trading horizon Pylon Public is expected to under-perform the Airports. In addition to that, Pylon Public is 1.32 times more volatile than Airports of Thailand. It trades about -0.47 of its total potential returns per unit of risk. Airports of Thailand is currently generating about 0.01 per unit of volatility. If you would invest 6,150 in Airports of Thailand on August 24, 2024 and sell it today you would earn a total of 0.00 from holding Airports of Thailand or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Pylon Public vs. Airports of Thailand
Performance |
| Timeline |
| Pylon Public |
| Airports of Thailand |
Pylon Public and Airports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pylon Public and Airports
The main advantage of trading using opposite Pylon Public and Airports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pylon Public position performs unexpectedly, Airports 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 Airports will offset losses from the drop in Airports' long position.| Pylon Public vs. Tata Steel Public | Pylon Public vs. Thaifoods Group Public | Pylon Public vs. TMT Steel Public | Pylon Public vs. The Erawan Group |
| Airports vs. CP ALL Public | Airports vs. PTT Public | Airports vs. Kasikornbank Public | Airports vs. Bangkok Dusit Medical |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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