Correlation Between SP Syndicate and CP ALL
Can any of the company-specific risk be diversified away by investing in both SP Syndicate and CP ALL 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 SP Syndicate and CP ALL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SP Syndicate Public and CP ALL Public, you can compare the effects of market volatilities on SP Syndicate and CP ALL 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 SP Syndicate with a short position of CP ALL. Check out your portfolio center. Please also check ongoing floating volatility patterns of SP Syndicate and CP ALL.
Diversification Opportunities for SP Syndicate and CP ALL
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SNP and CPALL is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding SP Syndicate Public and CP ALL Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CP ALL Public and SP Syndicate 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 SP Syndicate Public are associated (or correlated) with CP ALL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CP ALL Public has no effect on the direction of SP Syndicate i.e., SP Syndicate and CP ALL go up and down completely randomly.
Pair Corralation between SP Syndicate and CP ALL
Assuming the 90 days trading horizon SP Syndicate Public is expected to under-perform the CP ALL. But the stock apears to be less risky and, when comparing its historical volatility, SP Syndicate Public is 1.41 times less risky than CP ALL. The stock trades about -0.12 of its potential returns per unit of risk. The CP ALL Public is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 6,241 in CP ALL Public on September 2, 2024 and sell it today you would lose (116.00) from holding CP ALL Public or give up 1.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SP Syndicate Public vs. CP ALL Public
Performance |
| Timeline |
| SP Syndicate Public |
| CP ALL Public |
SP Syndicate and CP ALL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SP Syndicate and CP ALL
The main advantage of trading using opposite SP Syndicate and CP ALL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SP Syndicate position performs unexpectedly, CP ALL 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 CP ALL will offset losses from the drop in CP ALL's long position.| SP Syndicate vs. Thai Vegetable Oil | SP Syndicate vs. President Bakery Public | SP Syndicate vs. MK Restaurant Group | SP Syndicate vs. Thaitheparos Public |
| CP ALL vs. Airports of Thailand | CP ALL vs. PTT Public | CP ALL vs. Bangkok Dusit Medical | CP ALL vs. Kasikornbank 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |