Correlation Between Lohakit Metal and Bangkok Sheet

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

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

Diversification Opportunities for Lohakit Metal and Bangkok Sheet

-0.48

Correlation Coefficient

Lohakit Metal  Bangkok Sheet

Very good diversification

The 3 months correlation between Lohakit and Bangkok is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Lohakit Metal Public and Bangkok Sheet Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bangkok Sheet Metal and Lohakit Metal 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 Lohakit Metal Public are associated (or correlated) with Bangkok Sheet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bangkok Sheet Metal has no effect on the direction of Lohakit Metal i.e., Lohakit Metal and Bangkok Sheet go up and down completely randomly.

Pair Corralation between Lohakit Metal and Bangkok Sheet

Assuming the 90 days trading horizon Lohakit Metal Public is expected to under-perform the Bangkok Sheet. But the stock apears to be less risky and, when comparing its historical volatility, Lohakit Metal Public is 1.22 times less risky than Bangkok Sheet. The stock trades about -0.08 of its potential returns per unit of risk. The Bangkok Sheet Metal is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  292.00  in Bangkok Sheet Metal on September 14, 2024 and sell it today you would earn a total of  20.00  from holding Bangkok Sheet Metal or generate 6.85% return on investment over 90 days.

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

Lohakit Metal Public  vs.  Bangkok Sheet Metal

Lohakit Metal Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lohakit Metal Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Lohakit Metal is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

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.

Pair Trading with Lohakit Metal and Bangkok Sheet

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

The idea behind Lohakit Metal Public and Bangkok Sheet Metal 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.