Correlation Between JMT Network and Kiatnakin Phatra

Can any of the company-specific risk be diversified away by investing in both JMT Network and Kiatnakin Phatra 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 JMT Network and Kiatnakin Phatra into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between JMT Network Services and Kiatnakin Phatra Bank, you can compare the effects of market volatilities on JMT Network and Kiatnakin Phatra 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 JMT Network with a short position of Kiatnakin Phatra. Check out your portfolio center. Please also check ongoing floating volatility patterns of JMT Network and Kiatnakin Phatra.

Diversification Opportunities for JMT Network and Kiatnakin Phatra

0.62

Correlation Coefficient

JMT Network  Kiatnakin Phatra

Poor diversification

The 3 months correlation between JMT and Kiatnakin is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding JMT Network Services and Kiatnakin Phatra Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kiatnakin Phatra Bank and JMT Network 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 JMT Network Services are associated (or correlated) with Kiatnakin Phatra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kiatnakin Phatra Bank has no effect on the direction of JMT Network i.e., JMT Network and Kiatnakin Phatra go up and down completely randomly.

Pair Corralation between JMT Network and Kiatnakin Phatra

Assuming the 90 days trading horizon JMT Network Services is expected to generate 2.16 times more return on investment than Kiatnakin Phatra. However, JMT Network is 2.16 times more volatile than Kiatnakin Phatra Bank. It trades about 0.02 of its potential returns per unit of risk. Kiatnakin Phatra Bank is currently generating about 0.01 per unit of risk. If you would invest  1,870  in JMT Network Services on September 14, 2024 and sell it today you would earn a total of  10.00  from holding JMT Network Services or generate 0.53% return on investment over 90 days.

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

JMT Network Services  vs.  Kiatnakin Phatra Bank

JMT Network Services

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in JMT Network Services are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, JMT Network is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Kiatnakin Phatra Bank

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Kiatnakin Phatra Bank are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Kiatnakin Phatra is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with JMT Network and Kiatnakin Phatra

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

The idea behind JMT Network Services and Kiatnakin Phatra Bank 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.