Correlation Between Sirakorn PCL and NCL International
Can any of the company-specific risk be diversified away by investing in both Sirakorn PCL and NCL International 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 Sirakorn PCL and NCL International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sirakorn PCL and NCL International Logistics, you can compare the effects of market volatilities on Sirakorn PCL and NCL International 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 Sirakorn PCL with a short position of NCL International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sirakorn PCL and NCL International.
Diversification Opportunities for Sirakorn PCL and NCL International
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sirakorn and NCL is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Sirakorn PCL and NCL International Logistics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NCL International and Sirakorn PCL 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 Sirakorn PCL are associated (or correlated) with NCL International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NCL International has no effect on the direction of Sirakorn PCL i.e., Sirakorn PCL and NCL International go up and down completely randomly.
Pair Corralation between Sirakorn PCL and NCL International
Assuming the 90 days horizon Sirakorn PCL is expected to generate 122.67 times less return on investment than NCL International. But when comparing it to its historical volatility, Sirakorn PCL is 14.99 times less risky than NCL International. It trades about 0.01 of its potential returns per unit of risk. NCL International Logistics is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 256.00 in NCL International Logistics on September 1, 2024 and sell it today you would lose (207.00) from holding NCL International Logistics or give up 80.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Sirakorn PCL vs. NCL International Logistics
Performance |
| Timeline |
| Sirakorn PCL |
| NCL International |
Sirakorn PCL and NCL International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sirakorn PCL and NCL International
The main advantage of trading using opposite Sirakorn PCL and NCL International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sirakorn PCL position performs unexpectedly, NCL International 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 NCL International will offset losses from the drop in NCL International's long position.| Sirakorn PCL vs. Peerapat Technology Public | Sirakorn PCL vs. Shrinkflex Public | Sirakorn PCL vs. SiamEast Solutions Public | Sirakorn PCL vs. Smart Concrete Public |
| NCL International vs. Kingsmen CMTI Public | NCL International vs. International Research | NCL International vs. Masterkool International Public | NCL International vs. News Network |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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