Correlation Between RS Public and SGF Capital
Can any of the company-specific risk be diversified away by investing in both RS Public and SGF Capital 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 RS Public and SGF Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RS Public and SGF Capital Public, you can compare the effects of market volatilities on RS Public and SGF Capital 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 RS Public with a short position of SGF Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of RS Public and SGF Capital.
Diversification Opportunities for RS Public and SGF Capital
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between RS Public and SGF is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding RS Public and SGF Capital Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SGF Capital Public and RS 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 RS Public are associated (or correlated) with SGF Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SGF Capital Public has no effect on the direction of RS Public i.e., RS Public and SGF Capital go up and down completely randomly.
Pair Corralation between RS Public and SGF Capital
Assuming the 90 days horizon RS Public is expected to generate 1.0 times more return on investment than SGF Capital. However, RS Public is 1.0 times less risky than SGF Capital. It trades about 0.04 of its potential returns per unit of risk. SGF Capital Public is currently generating about 0.04 per unit of risk. If you would invest 679.00 in RS Public on September 14, 2024 and sell it today you would lose (104.00) from holding RS Public or give up 15.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
RS Public vs. SGF Capital Public
Performance |
| Timeline |
| RS Public |
| SGF Capital Public |
RS Public and SGF Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RS Public and SGF Capital
The main advantage of trading using opposite RS Public and SGF Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RS Public position performs unexpectedly, SGF Capital 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 SGF Capital will offset losses from the drop in SGF Capital's long position.| RS Public vs. Synnex Public | RS Public vs. SVI Public | RS Public vs. Interlink Communication Public | RS Public vs. The Erawan Group |
| SGF Capital vs. Power Solution Technologies | SGF Capital vs. RS Public | SGF Capital vs. Siam Steel International | SGF Capital vs. RPCG 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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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