Correlation Between SCG PACKAGING and Dental Public
Can any of the company-specific risk be diversified away by investing in both SCG PACKAGING and Dental Public 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 SCG PACKAGING and Dental Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCG PACKAGING PCL NVDR and Dental Public, you can compare the effects of market volatilities on SCG PACKAGING and Dental Public 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 SCG PACKAGING with a short position of Dental Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCG PACKAGING and Dental Public.
Diversification Opportunities for SCG PACKAGING and Dental Public
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between SCG and Dental is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding SCG PACKAGING PCL NVDR and Dental Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dental Public and SCG PACKAGING 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 SCG PACKAGING PCL NVDR are associated (or correlated) with Dental Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dental Public has no effect on the direction of SCG PACKAGING i.e., SCG PACKAGING and Dental Public go up and down completely randomly.
Pair Corralation between SCG PACKAGING and Dental Public
Assuming the 90 days trading horizon SCG PACKAGING PCL NVDR is expected to under-perform the Dental Public. But the stock apears to be less risky and, when comparing its historical volatility, SCG PACKAGING PCL NVDR is 25.84 times less risky than Dental Public. The stock trades about -0.11 of its potential returns per unit of risk. The Dental Public is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 357.00 in Dental Public on September 1, 2024 and sell it today you would lose (39.00) from holding Dental Public or give up 10.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
SCG PACKAGING PCL NVDR vs. Dental Public
Performance |
| Timeline |
| SCG PACKAGING PCL |
| Dental Public |
SCG PACKAGING and Dental Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCG PACKAGING and Dental Public
The main advantage of trading using opposite SCG PACKAGING and Dental Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCG PACKAGING position performs unexpectedly, Dental Public 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 Dental Public will offset losses from the drop in Dental Public's long position.| SCG PACKAGING vs. PTT Public | SCG PACKAGING vs. Kasikornbank Public | SCG PACKAGING vs. The Siam Cement | SCG PACKAGING vs. OSOTSPA PCL NVDR |
| Dental Public vs. Bangkok Dusit Medical | Dental Public vs. Bumrungrad Hospital Public | Dental Public vs. Bangkok Chain Hospital | Dental Public 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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