Correlation Between AIRA Factoring and Bangkok Sheet

Can any of the company-specific risk be diversified away by investing in both AIRA Factoring and Bangkok Sheet 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 AIRA Factoring and Bangkok Sheet into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AIRA Factoring Public and Bangkok Sheet Metal, you can compare the effects of market volatilities on AIRA Factoring and Bangkok Sheet 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 AIRA Factoring with a short position of Bangkok Sheet. Check out your portfolio center. Please also check ongoing floating volatility patterns of AIRA Factoring and Bangkok Sheet.

Diversification Opportunities for AIRA Factoring and Bangkok Sheet

0.02

Correlation Coefficient

AIRA Factoring  Bangkok Sheet

Significant diversification

The 3 months correlation between AIRA and Bangkok is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding AIRA Factoring Public and Bangkok Sheet Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bangkok Sheet Metal and AIRA Factoring 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 AIRA Factoring Public are associated (or correlated) with Bangkok Sheet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bangkok Sheet Metal has no effect on the direction of AIRA Factoring i.e., AIRA Factoring and Bangkok Sheet go up and down completely randomly.

Pair Corralation between AIRA Factoring and Bangkok Sheet

Assuming the 90 days horizon AIRA Factoring Public is expected to generate 9.2 times more return on investment than Bangkok Sheet. However, AIRA Factoring is 9.2 times more volatile than Bangkok Sheet Metal. It trades about 0.06 of its potential returns per unit of risk. Bangkok Sheet Metal is currently generating about 0.11 per unit of risk. If you would invest  56.00  in AIRA Factoring Public on September 13, 2024 and sell it today you would earn a total of  9.00  from holding AIRA Factoring Public or generate 16.07% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

AIRA Factoring Public  vs.  Bangkok Sheet Metal

AIRA Factoring Public

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in AIRA Factoring Public are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite weak fundamental drivers, AIRA Factoring disclosed solid returns over the last few months and may actually be approaching a breakup point.

Bangkok Sheet Metal

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Bangkok Sheet Metal are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent fundamental drivers, Bangkok Sheet is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with AIRA Factoring and Bangkok Sheet

The main advantage of trading using opposite AIRA Factoring and Bangkok Sheet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AIRA Factoring position performs unexpectedly, Bangkok Sheet 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 Sheet will offset losses from the drop in Bangkok Sheet's long position.

The idea behind AIRA Factoring Public and Bangkok Sheet Metal pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.