Correlation Between Bangkok Life and GFPT Public

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Can any of the company-specific risk be diversified away by investing in both Bangkok Life and GFPT Public 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 Bangkok Life and GFPT Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bangkok Life Assurance and GFPT Public, you can compare the effects of market volatilities on Bangkok Life and GFPT Public 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 Bangkok Life with a short position of GFPT Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bangkok Life and GFPT Public.

Diversification Opportunities for Bangkok Life and GFPT Public

-0.03
  Correlation Coefficient

Good diversification

The 3 months correlation between Bangkok and GFPT is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Bangkok Life Assurance and GFPT Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GFPT Public and Bangkok Life 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 Bangkok Life Assurance are associated (or correlated) with GFPT Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GFPT Public has no effect on the direction of Bangkok Life i.e., Bangkok Life and GFPT Public go up and down completely randomly.

Pair Corralation between Bangkok Life and GFPT Public

Assuming the 90 days trading horizon Bangkok Life Assurance is expected to generate 2.21 times more return on investment than GFPT Public. However, Bangkok Life is 2.21 times more volatile than GFPT Public. It trades about 0.05 of its potential returns per unit of risk. GFPT Public is currently generating about -0.13 per unit of risk. If you would invest  1,960  in Bangkok Life Assurance on September 13, 2024 and sell it today you would earn a total of  130.00  from holding Bangkok Life Assurance or generate 6.63% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy98.36%
ValuesDaily Returns

Bangkok Life Assurance  vs.  GFPT Public

 Performance 
       Timeline  
Bangkok Life Assurance 

Risk-Adjusted Performance

3 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Bangkok Life Assurance are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Bangkok Life may actually be approaching a critical reversion point that can send shares even higher in January 2025.
GFPT Public 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days GFPT Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's forward-looking signals remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Bangkok Life and GFPT Public Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Bangkok Life and GFPT Public

The main advantage of trading using opposite Bangkok Life and GFPT Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bangkok Life position performs unexpectedly, GFPT Public 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 GFPT Public will offset losses from the drop in GFPT Public's long position.
The idea behind Bangkok Life Assurance and GFPT 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.

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