Correlation Between Rojana Industrial and Chumporn Palm
Can any of the company-specific risk be diversified away by investing in both Rojana Industrial and Chumporn Palm 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 Rojana Industrial and Chumporn Palm into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rojana Industrial Park and Chumporn Palm Oil, you can compare the effects of market volatilities on Rojana Industrial and Chumporn Palm 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 Rojana Industrial with a short position of Chumporn Palm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rojana Industrial and Chumporn Palm.
Diversification Opportunities for Rojana Industrial and Chumporn Palm
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Rojana and Chumporn is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Rojana Industrial Park and Chumporn Palm Oil in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chumporn Palm Oil and Rojana Industrial 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 Rojana Industrial Park are associated (or correlated) with Chumporn Palm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chumporn Palm Oil has no effect on the direction of Rojana Industrial i.e., Rojana Industrial and Chumporn Palm go up and down completely randomly.
Pair Corralation between Rojana Industrial and Chumporn Palm
Assuming the 90 days trading horizon Rojana Industrial is expected to generate 68.93 times less return on investment than Chumporn Palm. But when comparing it to its historical volatility, Rojana Industrial Park is 52.08 times less risky than Chumporn Palm. It trades about 0.09 of its potential returns per unit of risk. Chumporn Palm Oil is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 242.00 in Chumporn Palm Oil on August 29, 2024 and sell it today you would earn a total of 32.00 from holding Chumporn Palm Oil or generate 13.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.41% |
| Values | Daily Returns |
Rojana Industrial Park vs. Chumporn Palm Oil
Performance |
| Timeline |
| Rojana Industrial Park |
| Chumporn Palm Oil |
Rojana Industrial and Chumporn Palm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rojana Industrial and Chumporn Palm
The main advantage of trading using opposite Rojana Industrial and Chumporn Palm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rojana Industrial position performs unexpectedly, Chumporn Palm 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 Chumporn Palm will offset losses from the drop in Chumporn Palm's long position.| Rojana Industrial vs. WHA Public | Rojana Industrial vs. Global Power Synergy | Rojana Industrial vs. TPI Polene Power | Rojana Industrial vs. Bangkok Expressway and |
| Chumporn Palm vs. Univanich Palm Oil | Chumporn Palm vs. Chiangmai Frozen Foods | Chumporn Palm vs. Dynasty Ceramic Public | Chumporn Palm vs. GFPT 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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