Correlation Between Lohakit Metal and S Khonkaen

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Can any of the company-specific risk be diversified away by investing in both Lohakit Metal and S Khonkaen 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 S Khonkaen 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 S Khonkaen Foods, you can compare the effects of market volatilities on Lohakit Metal and S Khonkaen 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 S Khonkaen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lohakit Metal and S Khonkaen.

Diversification Opportunities for Lohakit Metal and S Khonkaen

LohakitSORKONDiversified AwayLohakitSORKONDiversified Away100%
0.33
  Correlation Coefficient

Weak diversification

The 3 months correlation between Lohakit and SORKON is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Lohakit Metal Public and S Khonkaen Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on S Khonkaen Foods 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 S Khonkaen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of S Khonkaen Foods has no effect on the direction of Lohakit Metal i.e., Lohakit Metal and S Khonkaen go up and down completely randomly.

Pair Corralation between Lohakit Metal and S Khonkaen

Assuming the 90 days trading horizon Lohakit Metal Public is expected to generate 1.06 times more return on investment than S Khonkaen. However, Lohakit Metal is 1.06 times more volatile than S Khonkaen Foods. It trades about -0.1 of its potential returns per unit of risk. S Khonkaen Foods is currently generating about -0.12 per unit of risk. If you would invest  388.00  in Lohakit Metal Public on September 15, 2024 and sell it today you would lose (18.00) from holding Lohakit Metal Public or give up 4.64% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Lohakit Metal Public  vs.  S Khonkaen Foods

 Performance 
JavaScript chart by amCharts 3.21.15OctNov -50510
JavaScript chart by amCharts 3.21.15LHK SORKON
       Timeline  
Lohakit Metal Public 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
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.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec3.53.63.73.83.9
S Khonkaen Foods 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days S Khonkaen Foods has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, S Khonkaen is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec4.254.34.354.44.454.5

Lohakit Metal and S Khonkaen Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-2.73-2.05-1.36-0.67-0.01140.661.362.062.763.46 0.10.20.30.40.50.60.7
JavaScript chart by amCharts 3.21.15LHK SORKON
       Returns  

Pair Trading with Lohakit Metal and S Khonkaen

The main advantage of trading using opposite Lohakit Metal and S Khonkaen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lohakit Metal position performs unexpectedly, S Khonkaen 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 S Khonkaen will offset losses from the drop in S Khonkaen's long position.
The idea behind Lohakit Metal Public and S Khonkaen Foods 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 Transaction History module to view history of all your transactions and understand their impact on performance.

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