Correlation Between Stock Exchange and Eastern Star
Can any of the company-specific risk be diversified away by investing in both Stock Exchange and Eastern Star 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 Stock Exchange and Eastern Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stock Exchange Of and Eastern Star Real, you can compare the effects of market volatilities on Stock Exchange and Eastern Star 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 Stock Exchange with a short position of Eastern Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stock Exchange and Eastern Star.
Diversification Opportunities for Stock Exchange and Eastern Star
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Stock and Eastern is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Stock Exchange Of and Eastern Star Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastern Star Real and Stock Exchange 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 Stock Exchange Of are associated (or correlated) with Eastern Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastern Star Real has no effect on the direction of Stock Exchange i.e., Stock Exchange and Eastern Star go up and down completely randomly.
Pair Corralation between Stock Exchange and Eastern Star
Assuming the 90 days trading horizon Stock Exchange Of is expected to generate 0.31 times more return on investment than Eastern Star. However, Stock Exchange Of is 3.18 times less risky than Eastern Star. It trades about -0.07 of its potential returns per unit of risk. Eastern Star Real is currently generating about -0.09 per unit of risk. If you would invest 145,303 in Stock Exchange Of on August 28, 2024 and sell it today you would lose (1,478) from holding Stock Exchange Of or give up 1.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Stock Exchange Of vs. Eastern Star Real
Performance |
| Timeline |
Stock Exchange and Eastern Star Volatility Contrast
Predicted Return Density |
| Returns |
Stock Exchange Of
Pair trading matchups for Stock Exchange
Eastern Star Real
Pair trading matchups for Eastern Star
Pair Trading with Stock Exchange and Eastern Star
The main advantage of trading using opposite Stock Exchange and Eastern Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stock Exchange position performs unexpectedly, Eastern Star 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 Eastern Star will offset losses from the drop in Eastern Star's long position.| Stock Exchange vs. Turnkey Communication Services | Stock Exchange vs. Winnergy Medical Public | Stock Exchange vs. Charoen Pokphand Foods | Stock Exchange vs. Information and Communication |
| Eastern Star vs. Bangkok Land Public | Eastern Star vs. Everland Public | Eastern Star vs. Amata Public | Eastern Star vs. Chonburi Concrete Product |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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