Correlation Between Sahamit Machinery and Asia Aviation
Can any of the company-specific risk be diversified away by investing in both Sahamit Machinery and Asia Aviation 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 Sahamit Machinery and Asia Aviation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sahamit Machinery Public and Asia Aviation Public, you can compare the effects of market volatilities on Sahamit Machinery and Asia Aviation 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 Sahamit Machinery with a short position of Asia Aviation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sahamit Machinery and Asia Aviation.
Diversification Opportunities for Sahamit Machinery and Asia Aviation
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sahamit and Asia is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Sahamit Machinery Public and Asia Aviation Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Aviation Public and Sahamit Machinery 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 Sahamit Machinery Public are associated (or correlated) with Asia Aviation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Aviation Public has no effect on the direction of Sahamit Machinery i.e., Sahamit Machinery and Asia Aviation go up and down completely randomly.
Pair Corralation between Sahamit Machinery and Asia Aviation
Assuming the 90 days trading horizon Sahamit Machinery Public is expected to generate 0.39 times more return on investment than Asia Aviation. However, Sahamit Machinery Public is 2.54 times less risky than Asia Aviation. It trades about 0.11 of its potential returns per unit of risk. Asia Aviation Public is currently generating about -0.11 per unit of risk. If you would invest 398.00 in Sahamit Machinery Public on September 4, 2024 and sell it today you would earn a total of 6.00 from holding Sahamit Machinery Public or generate 1.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sahamit Machinery Public vs. Asia Aviation Public
Performance |
| Timeline |
| Sahamit Machinery Public |
| Asia Aviation Public |
Sahamit Machinery and Asia Aviation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sahamit Machinery and Asia Aviation
The main advantage of trading using opposite Sahamit Machinery and Asia Aviation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sahamit Machinery position performs unexpectedly, Asia Aviation 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 Asia Aviation will offset losses from the drop in Asia Aviation's long position.| Sahamit Machinery vs. Asia Aviation Public | Sahamit Machinery vs. Bangkok Dusit Medical | Sahamit Machinery vs. Bangkok Expressway and | Sahamit Machinery vs. Airports of Thailand |
| Asia Aviation vs. Airports of Thailand | Asia Aviation vs. Bangkok Expressway and | Asia Aviation vs. BTS Group Holdings | Asia Aviation vs. Bangkok Airways Public |
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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