Correlation Between TKS Technologies and Rajthanee Hospital
Can any of the company-specific risk be diversified away by investing in both TKS Technologies and Rajthanee Hospital 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 TKS Technologies and Rajthanee Hospital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TKS Technologies Public and Rajthanee Hospital Public, you can compare the effects of market volatilities on TKS Technologies and Rajthanee Hospital 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 TKS Technologies with a short position of Rajthanee Hospital. Check out your portfolio center. Please also check ongoing floating volatility patterns of TKS Technologies and Rajthanee Hospital.
Diversification Opportunities for TKS Technologies and Rajthanee Hospital
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between TKS and Rajthanee is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding TKS Technologies Public and Rajthanee Hospital Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rajthanee Hospital Public and TKS Technologies 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 TKS Technologies Public are associated (or correlated) with Rajthanee Hospital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rajthanee Hospital Public has no effect on the direction of TKS Technologies i.e., TKS Technologies and Rajthanee Hospital go up and down completely randomly.
Pair Corralation between TKS Technologies and Rajthanee Hospital
Assuming the 90 days trading horizon TKS Technologies Public is expected to under-perform the Rajthanee Hospital. But the stock apears to be less risky and, when comparing its historical volatility, TKS Technologies Public is 2.69 times less risky than Rajthanee Hospital. The stock trades about -0.3 of its potential returns per unit of risk. The Rajthanee Hospital Public is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 2,400 in Rajthanee Hospital Public on August 27, 2024 and sell it today you would lose (140.00) from holding Rajthanee Hospital Public or give up 5.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
TKS Technologies Public vs. Rajthanee Hospital Public
Performance |
| Timeline |
| TKS Technologies Public |
| Rajthanee Hospital Public |
TKS Technologies and Rajthanee Hospital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TKS Technologies and Rajthanee Hospital
The main advantage of trading using opposite TKS Technologies and Rajthanee Hospital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TKS Technologies position performs unexpectedly, Rajthanee Hospital 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 Rajthanee Hospital will offset losses from the drop in Rajthanee Hospital's long position.| TKS Technologies vs. Tata Steel Public | TKS Technologies vs. Thaifoods Group Public | TKS Technologies vs. TMT Steel Public | TKS Technologies vs. The Erawan Group |
| Rajthanee Hospital vs. Bangkok Chain Hospital | Rajthanee Hospital vs. Chularat Hospital Public | Rajthanee Hospital vs. Ratchaphruek Hospital Public | Rajthanee Hospital vs. Ekachai Medical Care |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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