Correlation Between Stock Exchange and Yong Concrete
Can any of the company-specific risk be diversified away by investing in both Stock Exchange and Yong Concrete 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 Yong Concrete 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 Yong Concrete PCL, you can compare the effects of market volatilities on Stock Exchange and Yong Concrete 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 Yong Concrete. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stock Exchange and Yong Concrete.
Diversification Opportunities for Stock Exchange and Yong Concrete
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Stock and Yong is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Stock Exchange Of and Yong Concrete PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yong Concrete PCL 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 Yong Concrete. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yong Concrete PCL has no effect on the direction of Stock Exchange i.e., Stock Exchange and Yong Concrete go up and down completely randomly.
Pair Corralation between Stock Exchange and Yong Concrete
Assuming the 90 days trading horizon Stock Exchange Of is expected to generate 0.26 times more return on investment than Yong Concrete. However, Stock Exchange Of is 3.87 times less risky than Yong Concrete. It trades about -0.07 of its potential returns per unit of risk. Yong Concrete PCL is currently generating about -0.24 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 Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stock Exchange Of vs. Yong Concrete PCL
Performance |
| Timeline |
Stock Exchange and Yong Concrete Volatility Contrast
Predicted Return Density |
| Returns |
Stock Exchange Of
Pair trading matchups for Stock Exchange
Yong Concrete PCL
Pair trading matchups for Yong Concrete
Pair Trading with Stock Exchange and Yong Concrete
The main advantage of trading using opposite Stock Exchange and Yong Concrete positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stock Exchange position performs unexpectedly, Yong Concrete 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 Yong Concrete will offset losses from the drop in Yong Concrete'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 |
| Yong Concrete vs. Wave Entertainment Public | Yong Concrete vs. Vibhavadi Medical Center | Yong Concrete vs. TPI Polene Public | Yong Concrete vs. Asia Green Energy |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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