Correlation Between Stock Exchange and Nava Nakorn
Can any of the company-specific risk be diversified away by investing in both Stock Exchange and Nava Nakorn 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 Nava Nakorn 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 Nava Nakorn Public, you can compare the effects of market volatilities on Stock Exchange and Nava Nakorn 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 Nava Nakorn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stock Exchange and Nava Nakorn.
Diversification Opportunities for Stock Exchange and Nava Nakorn
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Stock and Nava is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Stock Exchange Of and Nava Nakorn Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nava Nakorn Public 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 Nava Nakorn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nava Nakorn Public has no effect on the direction of Stock Exchange i.e., Stock Exchange and Nava Nakorn go up and down completely randomly.
Pair Corralation between Stock Exchange and Nava Nakorn
Assuming the 90 days trading horizon Stock Exchange Of is expected to generate 0.95 times more return on investment than Nava Nakorn. However, Stock Exchange Of is 1.05 times less risky than Nava Nakorn. It trades about -0.21 of its potential returns per unit of risk. Nava Nakorn Public is currently generating about -0.21 per unit of risk. If you would invest 138,691 in Stock Exchange Of on October 22, 2024 and sell it today you would lose (4,628) from holding Stock Exchange Of or give up 3.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stock Exchange Of vs. Nava Nakorn Public
Performance |
| Timeline |
Stock Exchange and Nava Nakorn Volatility Contrast
Predicted Return Density |
| Returns |
Stock Exchange Of
Pair trading matchups for Stock Exchange
Nava Nakorn Public
Pair trading matchups for Nava Nakorn
Pair Trading with Stock Exchange and Nava Nakorn
The main advantage of trading using opposite Stock Exchange and Nava Nakorn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stock Exchange position performs unexpectedly, Nava Nakorn 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 Nava Nakorn will offset losses from the drop in Nava Nakorn's long position.| Stock Exchange vs. Tanachira Retail | Stock Exchange vs. Warrix Sport PCL | Stock Exchange vs. Union Plastic Public | Stock Exchange vs. Inoue Rubber Public |
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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 Stocks Directory module to find actively traded stocks across global markets.
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