Correlation Between Bangkok Sheet and AIRA Factoring

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

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

Diversification Opportunities for Bangkok Sheet and AIRA Factoring

-0.23

Correlation Coefficient

Bangkok Sheet  AIRA Factoring

Very good diversification

The 3 months correlation between Bangkok and AIRA is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Bangkok Sheet Metal and AIRA Factoring Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIRA Factoring Public and Bangkok Sheet 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 Sheet Metal are associated (or correlated) with AIRA Factoring. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIRA Factoring Public has no effect on the direction of Bangkok Sheet i.e., Bangkok Sheet and AIRA Factoring go up and down completely randomly.

Pair Corralation between Bangkok Sheet and AIRA Factoring

Assuming the 90 days horizon Bangkok Sheet is expected to generate 4.31 times less return on investment than AIRA Factoring. But when comparing it to its historical volatility, Bangkok Sheet Metal is 8.94 times less risky than AIRA Factoring. It trades about 0.14 of its potential returns per unit of risk. AIRA Factoring Public is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  56.00  in AIRA Factoring Public on September 14, 2024 and sell it today you would earn a total of  10.00  from holding AIRA Factoring Public or generate 17.86% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

Bangkok Sheet Metal  vs.  AIRA Factoring Public

Bangkok Sheet Metal

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Bangkok Sheet Metal are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite weak fundamental drivers, Bangkok Sheet may actually be approaching a critical reversion point that can send shares even higher in January 2025.

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.

Pair Trading with Bangkok Sheet and AIRA Factoring

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

The idea behind Bangkok Sheet Metal and AIRA Factoring 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.