Correlation Between Somboon Advance and NSL Foods
Can any of the company-specific risk be diversified away by investing in both Somboon Advance and NSL Foods 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 Somboon Advance and NSL Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Somboon Advance Technology and NSL Foods Public, you can compare the effects of market volatilities on Somboon Advance and NSL Foods 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 Somboon Advance with a short position of NSL Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Somboon Advance and NSL Foods.
Diversification Opportunities for Somboon Advance and NSL Foods
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Somboon and NSL is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Somboon Advance Technology and NSL Foods Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NSL Foods Public and Somboon Advance 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 Somboon Advance Technology are associated (or correlated) with NSL Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NSL Foods Public has no effect on the direction of Somboon Advance i.e., Somboon Advance and NSL Foods go up and down completely randomly.
Pair Corralation between Somboon Advance and NSL Foods
Assuming the 90 days trading horizon Somboon Advance Technology is expected to under-perform the NSL Foods. But the stock apears to be less risky and, when comparing its historical volatility, Somboon Advance Technology is 1.57 times less risky than NSL Foods. The stock trades about -0.04 of its potential returns per unit of risk. The NSL Foods Public is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,147 in NSL Foods Public on November 29, 2024 and sell it today you would earn a total of 553.00 from holding NSL Foods Public or generate 25.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Somboon Advance Technology vs. NSL Foods Public
Performance |
| Timeline |
| Somboon Advance Tech |
| NSL Foods Public |
Somboon Advance and NSL Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Somboon Advance and NSL Foods
The main advantage of trading using opposite Somboon Advance and NSL Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Somboon Advance position performs unexpectedly, NSL Foods 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 NSL Foods will offset losses from the drop in NSL Foods' long position.| Somboon Advance vs. AAPICO Hitech Public | Somboon Advance vs. Thai Stanley Electric | Somboon Advance vs. Hana Microelectronics Public | Somboon Advance vs. TISCO Financial Group |
| NSL Foods vs. Earth Tech Environment | NSL Foods vs. General Environmental Conservation | NSL Foods vs. Premier Technology Public | NSL Foods vs. City Steel 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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