Correlation Between Eureka Design and Kiatnakin Phatra
Can any of the company-specific risk be diversified away by investing in both Eureka Design and Kiatnakin Phatra 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 Eureka Design and Kiatnakin Phatra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eureka Design Public and Kiatnakin Phatra Bank, you can compare the effects of market volatilities on Eureka Design and Kiatnakin Phatra 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 Eureka Design with a short position of Kiatnakin Phatra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eureka Design and Kiatnakin Phatra.
Diversification Opportunities for Eureka Design and Kiatnakin Phatra
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Eureka and Kiatnakin is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Eureka Design Public and Kiatnakin Phatra Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kiatnakin Phatra Bank and Eureka Design 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 Eureka Design Public are associated (or correlated) with Kiatnakin Phatra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kiatnakin Phatra Bank has no effect on the direction of Eureka Design i.e., Eureka Design and Kiatnakin Phatra go up and down completely randomly.
Pair Corralation between Eureka Design and Kiatnakin Phatra
Assuming the 90 days trading horizon Eureka Design Public is expected to under-perform the Kiatnakin Phatra. In addition to that, Eureka Design is 3.35 times more volatile than Kiatnakin Phatra Bank. It trades about -0.01 of its total potential returns per unit of risk. Kiatnakin Phatra Bank is currently generating about 0.08 per unit of volatility. If you would invest 5,050 in Kiatnakin Phatra Bank on October 20, 2024 and sell it today you would earn a total of 125.00 from holding Kiatnakin Phatra Bank or generate 2.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eureka Design Public vs. Kiatnakin Phatra Bank
Performance |
| Timeline |
| Eureka Design Public |
| Kiatnakin Phatra Bank |
Eureka Design and Kiatnakin Phatra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eureka Design and Kiatnakin Phatra
The main advantage of trading using opposite Eureka Design and Kiatnakin Phatra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eureka Design position performs unexpectedly, Kiatnakin Phatra 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 Kiatnakin Phatra will offset losses from the drop in Kiatnakin Phatra's long position.| Eureka Design vs. PTT Public | Eureka Design vs. Kasikornbank Public | Eureka Design vs. The Siam Cement | Eureka Design vs. OSOTSPA PCL NVDR |
| Kiatnakin Phatra vs. TISCO Financial Group | Kiatnakin Phatra vs. Kasikornbank Public | Kiatnakin Phatra vs. Thanachart Capital Public | Kiatnakin Phatra vs. SCB X 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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