Correlation Between Sri Trang and Peerapat Technology
Can any of the company-specific risk be diversified away by investing in both Sri Trang and Peerapat Technology 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 Sri Trang and Peerapat Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sri Trang Agro Industry and Peerapat Technology Public, you can compare the effects of market volatilities on Sri Trang and Peerapat Technology 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 Sri Trang with a short position of Peerapat Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sri Trang and Peerapat Technology.
Diversification Opportunities for Sri Trang and Peerapat Technology
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sri and Peerapat is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Sri Trang Agro Industry and Peerapat Technology Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peerapat Technology and Sri Trang 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 Sri Trang Agro Industry are associated (or correlated) with Peerapat Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peerapat Technology has no effect on the direction of Sri Trang i.e., Sri Trang and Peerapat Technology go up and down completely randomly.
Pair Corralation between Sri Trang and Peerapat Technology
Assuming the 90 days trading horizon Sri Trang Agro Industry is expected to under-perform the Peerapat Technology. But the stock apears to be less risky and, when comparing its historical volatility, Sri Trang Agro Industry is 1.53 times less risky than Peerapat Technology. The stock trades about -0.05 of its potential returns per unit of risk. The Peerapat Technology Public is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 136.00 in Peerapat Technology Public on September 12, 2024 and sell it today you would earn a total of 5.00 from holding Peerapat Technology Public or generate 3.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Sri Trang Agro Industry vs. Peerapat Technology Public
Performance |
| Timeline |
| Sri Trang Agro |
| Peerapat Technology |
Sri Trang and Peerapat Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sri Trang and Peerapat Technology
The main advantage of trading using opposite Sri Trang and Peerapat Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sri Trang position performs unexpectedly, Peerapat Technology 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 Peerapat Technology will offset losses from the drop in Peerapat Technology's long position.| Sri Trang vs. Hwa Fong Rubber | Sri Trang vs. AAPICO Hitech Public | Sri Trang vs. Haad Thip Public | Sri Trang vs. Italian Thai Development Public |
| Peerapat Technology vs. Sri Trang Agro Industry | Peerapat Technology vs. Jay Mart Public | Peerapat Technology vs. Com7 PCL | Peerapat Technology vs. Energy Absolute 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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