Correlation Between Sahamit Machinery and BA Airport
Can any of the company-specific risk be diversified away by investing in both Sahamit Machinery and BA Airport 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 BA Airport 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 BA Airport Leasehold, you can compare the effects of market volatilities on Sahamit Machinery and BA Airport 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 BA Airport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sahamit Machinery and BA Airport.
Diversification Opportunities for Sahamit Machinery and BA Airport
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sahamit and BAREIT is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Sahamit Machinery Public and BA Airport Leasehold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BA Airport Leasehold 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 BA Airport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BA Airport Leasehold has no effect on the direction of Sahamit Machinery i.e., Sahamit Machinery and BA Airport go up and down completely randomly.
Pair Corralation between Sahamit Machinery and BA Airport
Assuming the 90 days trading horizon Sahamit Machinery Public is expected to under-perform the BA Airport. But the stock apears to be less risky and, when comparing its historical volatility, Sahamit Machinery Public is 1.47 times less risky than BA Airport. The stock trades about -0.13 of its potential returns per unit of risk. The BA Airport Leasehold is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 945.00 in BA Airport Leasehold on September 13, 2024 and sell it today you would earn a total of 5.00 from holding BA Airport Leasehold or generate 0.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sahamit Machinery Public vs. BA Airport Leasehold
Performance |
| Timeline |
| Sahamit Machinery Public |
| BA Airport Leasehold |
Sahamit Machinery and BA Airport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sahamit Machinery and BA Airport
The main advantage of trading using opposite Sahamit Machinery and BA Airport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sahamit Machinery position performs unexpectedly, BA Airport 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 BA Airport will offset losses from the drop in BA Airport's long position.| Sahamit Machinery vs. MCS Steel Public | Sahamit Machinery vs. Somboon Advance Technology | Sahamit Machinery vs. Lohakit Metal Public | Sahamit Machinery vs. SNC Former Public |
| BA Airport vs. Premier Technology Public | BA Airport vs. Lohakit Metal Public | BA Airport vs. Taokaenoi Food Marketing | BA Airport vs. AIM Industrial Growth |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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