Correlation Between True Public and Workpoint Entertainment
Can any of the company-specific risk be diversified away by investing in both True Public and Workpoint Entertainment 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 True Public and Workpoint Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between True Public and Workpoint Entertainment Public, you can compare the effects of market volatilities on True Public and Workpoint Entertainment 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 True Public with a short position of Workpoint Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of True Public and Workpoint Entertainment.
Diversification Opportunities for True Public and Workpoint Entertainment
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between True and Workpoint is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding True Public and Workpoint Entertainment Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Workpoint Entertainment and True Public 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 True Public are associated (or correlated) with Workpoint Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Workpoint Entertainment has no effect on the direction of True Public i.e., True Public and Workpoint Entertainment go up and down completely randomly.
Pair Corralation between True Public and Workpoint Entertainment
Assuming the 90 days trading horizon True Public is expected to generate 7.23 times less return on investment than Workpoint Entertainment. But when comparing it to its historical volatility, True Public is 12.25 times less risky than Workpoint Entertainment. It trades about 0.06 of its potential returns per unit of risk. Workpoint Entertainment Public is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,821 in Workpoint Entertainment Public on August 31, 2024 and sell it today you would lose (1,041) from holding Workpoint Entertainment Public or give up 57.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
True Public vs. Workpoint Entertainment Public
Performance |
| Timeline |
| True Public |
| Workpoint Entertainment |
True Public and Workpoint Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with True Public and Workpoint Entertainment
The main advantage of trading using opposite True Public and Workpoint Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if True Public position performs unexpectedly, Workpoint Entertainment 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 Workpoint Entertainment will offset losses from the drop in Workpoint Entertainment's long position.| True Public vs. Advanced Info Service | True Public vs. PTT Public | True Public vs. Charoen Pokphand Foods | True Public vs. SCB X 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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