Correlation Between Yong Concrete and SCG PACKAGING
Can any of the company-specific risk be diversified away by investing in both Yong Concrete and SCG PACKAGING 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 Yong Concrete and SCG PACKAGING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yong Concrete PCL and SCG PACKAGING PCL NVDR, you can compare the effects of market volatilities on Yong Concrete and SCG PACKAGING 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 Yong Concrete with a short position of SCG PACKAGING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yong Concrete and SCG PACKAGING.
Diversification Opportunities for Yong Concrete and SCG PACKAGING
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Yong and SCG is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Yong Concrete PCL and SCG PACKAGING PCL NVDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCG PACKAGING PCL and Yong Concrete 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 Yong Concrete PCL are associated (or correlated) with SCG PACKAGING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCG PACKAGING PCL has no effect on the direction of Yong Concrete i.e., Yong Concrete and SCG PACKAGING go up and down completely randomly.
Pair Corralation between Yong Concrete and SCG PACKAGING
Assuming the 90 days trading horizon Yong Concrete PCL is expected to generate 0.84 times more return on investment than SCG PACKAGING. However, Yong Concrete PCL is 1.19 times less risky than SCG PACKAGING. It trades about -0.12 of its potential returns per unit of risk. SCG PACKAGING PCL NVDR is currently generating about -0.11 per unit of risk. If you would invest 197.00 in Yong Concrete PCL on September 1, 2024 and sell it today you would lose (75.00) from holding Yong Concrete PCL or give up 38.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Yong Concrete PCL vs. SCG PACKAGING PCL NVDR
Performance |
| Timeline |
| Yong Concrete PCL |
| SCG PACKAGING PCL |
Yong Concrete and SCG PACKAGING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yong Concrete and SCG PACKAGING
The main advantage of trading using opposite Yong Concrete and SCG PACKAGING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yong Concrete position performs unexpectedly, SCG PACKAGING 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 SCG PACKAGING will offset losses from the drop in SCG PACKAGING's long position.| Yong Concrete vs. Exotic Food Public | Yong Concrete vs. Knight Club Capital | Yong Concrete vs. North East Rubbers | Yong Concrete vs. Yggdrazil Group Public |
| SCG PACKAGING vs. PTT Public | SCG PACKAGING vs. Kasikornbank Public | SCG PACKAGING vs. The Siam Cement | SCG PACKAGING vs. OSOTSPA PCL NVDR |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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