Correlation Between Sena Development and Premier Marketing
Can any of the company-specific risk be diversified away by investing in both Sena Development and Premier Marketing 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 Sena Development and Premier Marketing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sena Development Public and Premier Marketing Public, you can compare the effects of market volatilities on Sena Development and Premier Marketing 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 Sena Development with a short position of Premier Marketing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sena Development and Premier Marketing.
Diversification Opportunities for Sena Development and Premier Marketing
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sena and Premier is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Sena Development Public and Premier Marketing Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Premier Marketing Public and Sena Development 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 Sena Development Public are associated (or correlated) with Premier Marketing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Premier Marketing Public has no effect on the direction of Sena Development i.e., Sena Development and Premier Marketing go up and down completely randomly.
Pair Corralation between Sena Development and Premier Marketing
Assuming the 90 days trading horizon Sena Development Public is expected to generate 50.68 times more return on investment than Premier Marketing. However, Sena Development is 50.68 times more volatile than Premier Marketing Public. It trades about 0.08 of its potential returns per unit of risk. Premier Marketing Public is currently generating about 0.09 per unit of risk. If you would invest 250.00 in Sena Development Public on September 1, 2024 and sell it today you would lose (26.00) from holding Sena Development Public or give up 10.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Sena Development Public vs. Premier Marketing Public
Performance |
| Timeline |
| Sena Development Public |
| Premier Marketing Public |
Sena Development and Premier Marketing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sena Development and Premier Marketing
The main advantage of trading using opposite Sena Development and Premier Marketing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sena Development position performs unexpectedly, Premier Marketing 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 Premier Marketing will offset losses from the drop in Premier Marketing's long position.| Sena Development vs. Bhiraj Office Leasehold | Sena Development vs. Thai Life Insurance | Sena Development vs. PTT OIL RETAIL | Sena Development vs. Silicon Craft Technology |
| Premier Marketing vs. Haad Thip Public | Premier Marketing vs. MK Restaurant Group | Premier Marketing vs. Thai Union Group | Premier Marketing vs. Taokaenoi Food Marketing |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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