Correlation Between Yong Concrete and Vibhavadi Medical
Can any of the company-specific risk be diversified away by investing in both Yong Concrete and Vibhavadi Medical 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 Vibhavadi Medical 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 Vibhavadi Medical Center, you can compare the effects of market volatilities on Yong Concrete and Vibhavadi Medical 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 Vibhavadi Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yong Concrete and Vibhavadi Medical.
Diversification Opportunities for Yong Concrete and Vibhavadi Medical
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Yong and Vibhavadi is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Yong Concrete PCL and Vibhavadi Medical Center in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vibhavadi Medical Center 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 Vibhavadi Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vibhavadi Medical Center has no effect on the direction of Yong Concrete i.e., Yong Concrete and Vibhavadi Medical go up and down completely randomly.
Pair Corralation between Yong Concrete and Vibhavadi Medical
Assuming the 90 days trading horizon Yong Concrete PCL is expected to under-perform the Vibhavadi Medical. In addition to that, Yong Concrete is 1.4 times more volatile than Vibhavadi Medical Center. It trades about -0.22 of its total potential returns per unit of risk. Vibhavadi Medical Center is currently generating about 0.17 per unit of volatility. If you would invest 191.00 in Vibhavadi Medical Center on September 1, 2024 and sell it today you would earn a total of 13.00 from holding Vibhavadi Medical Center or generate 6.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yong Concrete PCL vs. Vibhavadi Medical Center
Performance |
| Timeline |
| Yong Concrete PCL |
| Vibhavadi Medical Center |
Yong Concrete and Vibhavadi Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yong Concrete and Vibhavadi Medical
The main advantage of trading using opposite Yong Concrete and Vibhavadi Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yong Concrete position performs unexpectedly, Vibhavadi Medical 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 Vibhavadi Medical will offset losses from the drop in Vibhavadi Medical'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 |
| Vibhavadi Medical vs. Chularat Hospital Public | Vibhavadi Medical vs. Bangkok Chain Hospital | Vibhavadi Medical vs. Bangkok Dusit Medical | Vibhavadi Medical vs. Bumrungrad Hospital 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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