Correlation Between Teka Construction and GMM Grammy
Can any of the company-specific risk be diversified away by investing in both Teka Construction and GMM Grammy 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 Teka Construction and GMM Grammy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Teka Construction PCL and GMM Grammy Public, you can compare the effects of market volatilities on Teka Construction and GMM Grammy 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 Teka Construction with a short position of GMM Grammy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teka Construction and GMM Grammy.
Diversification Opportunities for Teka Construction and GMM Grammy
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Teka and GMM is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Teka Construction PCL and GMM Grammy Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GMM Grammy Public and Teka Construction 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 Teka Construction PCL are associated (or correlated) with GMM Grammy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GMM Grammy Public has no effect on the direction of Teka Construction i.e., Teka Construction and GMM Grammy go up and down completely randomly.
Pair Corralation between Teka Construction and GMM Grammy
Assuming the 90 days trading horizon Teka Construction is expected to generate 1.44 times less return on investment than GMM Grammy. In addition to that, Teka Construction is 1.79 times more volatile than GMM Grammy Public. It trades about 0.04 of its total potential returns per unit of risk. GMM Grammy Public is currently generating about 0.11 per unit of volatility. If you would invest 670.00 in GMM Grammy Public on November 3, 2024 and sell it today you would earn a total of 120.00 from holding GMM Grammy Public or generate 17.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.37% |
| Values | Daily Returns |
Teka Construction PCL vs. GMM Grammy Public
Performance |
| Timeline |
| Teka Construction PCL |
| GMM Grammy Public |
Teka Construction and GMM Grammy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Teka Construction and GMM Grammy
The main advantage of trading using opposite Teka Construction and GMM Grammy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teka Construction position performs unexpectedly, GMM Grammy 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 GMM Grammy will offset losses from the drop in GMM Grammy's long position.| Teka Construction vs. TKrungthai Industries Public | Teka Construction vs. TCM Public | Teka Construction vs. Well Graded Engineering | Teka Construction vs. The Steel Public |
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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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