Correlation Between Amata Public and Bangkok Land

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

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

Diversification Opportunities for Amata Public and Bangkok Land

-0.81

Correlation Coefficient

Amata Public  Bangkok Land

Pay attention - limited upside

The 3 months correlation between Amata and Bangkok is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Amata Public and Bangkok Land Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bangkok Land Public and Amata Public 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 Amata Public are associated (or correlated) with Bangkok Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bangkok Land Public has no effect on the direction of Amata Public i.e., Amata Public and Bangkok Land go up and down completely randomly.

Pair Corralation between Amata Public and Bangkok Land

Assuming the 90 days trading horizon Amata Public is expected to generate 1.86 times more return on investment than Bangkok Land. However, Amata Public is 1.86 times more volatile than Bangkok Land Public. It trades about 0.14 of its potential returns per unit of risk. Bangkok Land Public is currently generating about -0.12 per unit of risk. If you would invest  2,490  in Amata Public on September 15, 2024 and sell it today you would earn a total of  460.00  from holding Amata Public or generate 18.47% return on investment over 90 days.

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

Amata Public  vs.  Bangkok Land Public

Amata Public

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Amata Public are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat conflicting fundamental drivers, Amata Public sustained solid returns over the last few months and may actually be approaching a breakup point.

Bangkok Land Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bangkok Land Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's fundamental drivers remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Amata Public and Bangkok Land

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

The idea behind Amata Public and Bangkok Land Public 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.

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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.