Correlation Between Vibhavadi Medical and Bangkok Dusit
Can any of the company-specific risk be diversified away by investing in both Vibhavadi Medical and Bangkok Dusit 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 Vibhavadi Medical and Bangkok Dusit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vibhavadi Medical Center and Bangkok Dusit Medical, you can compare the effects of market volatilities on Vibhavadi Medical and Bangkok Dusit 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 Vibhavadi Medical with a short position of Bangkok Dusit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vibhavadi Medical and Bangkok Dusit.
Diversification Opportunities for Vibhavadi Medical and Bangkok Dusit
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Vibhavadi and Bangkok is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Vibhavadi Medical Center and Bangkok Dusit Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bangkok Dusit Medical and Vibhavadi Medical 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 Vibhavadi Medical Center are associated (or correlated) with Bangkok Dusit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bangkok Dusit Medical has no effect on the direction of Vibhavadi Medical i.e., Vibhavadi Medical and Bangkok Dusit go up and down completely randomly.
Pair Corralation between Vibhavadi Medical and Bangkok Dusit
Assuming the 90 days trading horizon Vibhavadi Medical Center is expected to generate 1.23 times more return on investment than Bangkok Dusit. However, Vibhavadi Medical is 1.23 times more volatile than Bangkok Dusit Medical. It trades about 0.19 of its potential returns per unit of risk. Bangkok Dusit Medical is currently generating about -0.22 per unit of risk. If you would invest 194.00 in Vibhavadi Medical Center on August 26, 2024 and sell it today you would earn a total of 14.00 from holding Vibhavadi Medical Center or generate 7.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vibhavadi Medical Center vs. Bangkok Dusit Medical
Performance |
| Timeline |
| Vibhavadi Medical Center |
| Bangkok Dusit Medical |
Vibhavadi Medical and Bangkok Dusit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vibhavadi Medical and Bangkok Dusit
The main advantage of trading using opposite Vibhavadi Medical and Bangkok Dusit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vibhavadi Medical position performs unexpectedly, Bangkok Dusit 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 Bangkok Dusit will offset losses from the drop in Bangkok Dusit's long position.| Vibhavadi Medical vs. Ekachai Medical Care | Vibhavadi Medical vs. Bangkok Chain Hospital | Vibhavadi Medical vs. Srivichaivejvivat 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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