Correlation Between Rojana Industrial and Praram 9
Can any of the company-specific risk be diversified away by investing in both Rojana Industrial and Praram 9 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 Praram 9 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 Praram 9 Hospital, you can compare the effects of market volatilities on Rojana Industrial and Praram 9 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 Praram 9. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rojana Industrial and Praram 9.
Diversification Opportunities for Rojana Industrial and Praram 9
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Rojana and Praram is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Rojana Industrial Park and Praram 9 Hospital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Praram 9 Hospital 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 Praram 9. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Praram 9 Hospital has no effect on the direction of Rojana Industrial i.e., Rojana Industrial and Praram 9 go up and down completely randomly.
Pair Corralation between Rojana Industrial and Praram 9
Assuming the 90 days trading horizon Rojana Industrial is expected to generate 2.51 times less return on investment than Praram 9. In addition to that, Rojana Industrial is 1.12 times more volatile than Praram 9 Hospital. It trades about 0.02 of its total potential returns per unit of risk. Praram 9 Hospital is currently generating about 0.06 per unit of volatility. If you would invest 1,638 in Praram 9 Hospital on September 4, 2024 and sell it today you would earn a total of 937.00 from holding Praram 9 Hospital or generate 57.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Rojana Industrial Park vs. Praram 9 Hospital
Performance |
| Timeline |
| Rojana Industrial Park |
| Praram 9 Hospital |
Rojana Industrial and Praram 9 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rojana Industrial and Praram 9
The main advantage of trading using opposite Rojana Industrial and Praram 9 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rojana Industrial position performs unexpectedly, Praram 9 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 Praram 9 will offset losses from the drop in Praram 9's long position.| Rojana Industrial vs. Bangchak Public | Rojana Industrial vs. Gulf Energy Development | Rojana Industrial vs. Bangkok Expressway and | Rojana Industrial vs. BGrimm Power Public |
| Praram 9 vs. Bangkok Dusit Medical | Praram 9 vs. Bumrungrad Hospital Public | Praram 9 vs. Bangkok Chain Hospital | Praram 9 vs. Rajthanee Hospital 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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