Correlation Between Phatra Leasing and Syntec Construction

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

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

Diversification Opportunities for Phatra Leasing and Syntec Construction

0.23

Correlation Coefficient

Phatra Leasing  Syntec Construction

Modest diversification

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

Pair Corralation between Phatra Leasing and Syntec Construction

Assuming the 90 days horizon Phatra Leasing Public is expected to under-perform the Syntec Construction. But the stock apears to be less risky and, when comparing its historical volatility, Phatra Leasing Public is 1.11 times less risky than Syntec Construction. The stock trades about -0.19 of its potential returns per unit of risk. The Syntec Construction Public is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  156.00  in Syntec Construction Public on September 16, 2024 and sell it today you would earn a total of  5.00  from holding Syntec Construction Public or generate 3.21% return on investment over 90 days.

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

Phatra Leasing Public  vs.  Syntec Construction Public

Phatra Leasing Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Phatra Leasing 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 fundamental drivers 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.

Syntec Construction

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Syntec Construction Public are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Syntec Construction is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Phatra Leasing and Syntec Construction

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

The idea behind Phatra Leasing Public and Syntec Construction 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.