Correlation Between Regional Container and PTT OIL
Can any of the company-specific risk be diversified away by investing in both Regional Container and PTT OIL 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 Regional Container and PTT OIL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regional Container Lines and PTT OIL RETAIL, you can compare the effects of market volatilities on Regional Container and PTT OIL 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 Regional Container with a short position of PTT OIL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regional Container and PTT OIL.
Diversification Opportunities for Regional Container and PTT OIL
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Regional and PTT is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Regional Container Lines and PTT OIL RETAIL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PTT OIL RETAIL and Regional Container 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 Regional Container Lines are associated (or correlated) with PTT OIL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PTT OIL RETAIL has no effect on the direction of Regional Container i.e., Regional Container and PTT OIL go up and down completely randomly.
Pair Corralation between Regional Container and PTT OIL
Assuming the 90 days trading horizon Regional Container Lines is expected to generate 39.18 times more return on investment than PTT OIL. However, Regional Container is 39.18 times more volatile than PTT OIL RETAIL. It trades about 0.06 of its potential returns per unit of risk. PTT OIL RETAIL is currently generating about -0.06 per unit of risk. If you would invest 3,075 in Regional Container Lines on September 24, 2024 and sell it today you would lose (300.00) from holding Regional Container Lines or give up 9.76% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Regional Container Lines vs. PTT OIL RETAIL
Performance |
Timeline |
Regional Container Lines |
PTT OIL RETAIL |
Regional Container and PTT OIL Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Regional Container and PTT OIL
The main advantage of trading using opposite Regional Container and PTT OIL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regional Container position performs unexpectedly, PTT OIL 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 PTT OIL will offset losses from the drop in PTT OIL's long position.Regional Container vs. INET Leasehold REIT | Regional Container vs. Golden Ventures Leasehold | Regional Container vs. Mitsib Leasing Public | Regional Container vs. Communication System Solution |
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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