Correlation Between SCB X and Ladprao General
Can any of the company-specific risk be diversified away by investing in both SCB X and Ladprao General 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 SCB X and Ladprao General into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCB X Public and Ladprao General Hospital, you can compare the effects of market volatilities on SCB X and Ladprao General 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 SCB X with a short position of Ladprao General. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCB X and Ladprao General.
Diversification Opportunities for SCB X and Ladprao General
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SCB and Ladprao is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding SCB X Public and Ladprao General Hospital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ladprao General Hospital and SCB X 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 SCB X Public are associated (or correlated) with Ladprao General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ladprao General Hospital has no effect on the direction of SCB X i.e., SCB X and Ladprao General go up and down completely randomly.
Pair Corralation between SCB X and Ladprao General
Assuming the 90 days trading horizon SCB X Public is expected to generate 1.64 times more return on investment than Ladprao General. However, SCB X is 1.64 times more volatile than Ladprao General Hospital. It trades about 0.08 of its potential returns per unit of risk. Ladprao General Hospital is currently generating about -0.09 per unit of risk. If you would invest 10,353 in SCB X Public on September 2, 2024 and sell it today you would earn a total of 1,097 from holding SCB X Public or generate 10.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
SCB X Public vs. Ladprao General Hospital
Performance |
| Timeline |
| SCB X Public |
| Ladprao General Hospital |
SCB X and Ladprao General Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCB X and Ladprao General
The main advantage of trading using opposite SCB X and Ladprao General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCB X position performs unexpectedly, Ladprao General 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 Ladprao General will offset losses from the drop in Ladprao General's long position.| SCB X vs. Porn Prom Metal | SCB X vs. Halcyon Technology Public | SCB X vs. Rojana Industrial Park | SCB X vs. Sri panwa Hospitality |
| Ladprao General vs. Ekachai Medical Care | Ladprao General vs. Bangkok Chain Hospital | Ladprao General vs. Rajthanee Hospital Public | Ladprao General vs. Chularat 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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