Correlation Between Vibhavadi Medical and LPN Development
Can any of the company-specific risk be diversified away by investing in both Vibhavadi Medical and LPN Development 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 LPN Development 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 LPN Development Public, you can compare the effects of market volatilities on Vibhavadi Medical and LPN Development 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 LPN Development. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vibhavadi Medical and LPN Development.
Diversification Opportunities for Vibhavadi Medical and LPN Development
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Vibhavadi and LPN is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Vibhavadi Medical Center and LPN Development Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LPN Development Public 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 LPN Development. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LPN Development Public has no effect on the direction of Vibhavadi Medical i.e., Vibhavadi Medical and LPN Development go up and down completely randomly.
Pair Corralation between Vibhavadi Medical and LPN Development
Assuming the 90 days trading horizon Vibhavadi Medical Center is expected to generate 1.0 times more return on investment than LPN Development. However, Vibhavadi Medical is 1.0 times more volatile than LPN Development Public. It trades about 0.04 of its potential returns per unit of risk. LPN Development Public is currently generating about 0.04 per unit of risk. If you would invest 253.00 in Vibhavadi Medical Center on September 13, 2024 and sell it today you would lose (41.00) from holding Vibhavadi Medical Center or give up 16.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vibhavadi Medical Center vs. LPN Development Public
Performance |
| Timeline |
| Vibhavadi Medical Center |
| LPN Development Public |
Vibhavadi Medical and LPN Development Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vibhavadi Medical and LPN Development
The main advantage of trading using opposite Vibhavadi Medical and LPN Development positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vibhavadi Medical position performs unexpectedly, LPN Development 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 LPN Development will offset losses from the drop in LPN Development's long position.| Vibhavadi Medical vs. Chularat Hospital Public | Vibhavadi Medical vs. Bangkok Chain Hospital | Vibhavadi Medical vs. Bangkok Dusit Medical | Vibhavadi Medical vs. Bumrungrad Hospital 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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