Correlation Between Bangkok Land and JCK International

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

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

Diversification Opportunities for Bangkok Land and JCK International

0.86

Correlation Coefficient

Bangkok Land  JCK International

Very poor diversification

The 3 months correlation between Bangkok and JCK is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Bangkok Land Public and JCK International Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JCK International Public and Bangkok Land 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 Land Public are associated (or correlated) with JCK International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JCK International Public has no effect on the direction of Bangkok Land i.e., Bangkok Land and JCK International go up and down completely randomly.

Pair Corralation between Bangkok Land and JCK International

Assuming the 90 days trading horizon Bangkok Land Public is expected to generate 0.37 times more return on investment than JCK International. However, Bangkok Land Public is 2.67 times less risky than JCK International. It trades about -0.12 of its potential returns per unit of risk. JCK International Public is currently generating about -0.17 per unit of risk. If you would invest  67.00  in Bangkok Land Public on September 17, 2024 and sell it today you would lose (6.00) from holding Bangkok Land Public or give up 8.96% of portfolio value over 90 days.

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

Bangkok Land Public  vs.  JCK International Public

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.

JCK International Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JCK International Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's forward-looking signals remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Bangkok Land and JCK International

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

The idea behind Bangkok Land Public and JCK International 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.

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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.