Correlation Between Regional Container and Prinsiri Public

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

Diversification Opportunities for Regional Container and Prinsiri Public

-0.48

Correlation Coefficient

Regional Container  Prinsiri Public

Very good diversification

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

Pair Corralation between Regional Container and Prinsiri Public

Assuming the 90 days trading horizon Regional Container Lines is expected to generate 1.41 times more return on investment than Prinsiri Public. However, Regional Container is 1.41 times more volatile than Prinsiri Public. It trades about 0.06 of its potential returns per unit of risk. Prinsiri Public is currently generating about 0.04 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.  Prinsiri Public

Regional Container Lines

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Regional Container Lines are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat inconsistent fundamental drivers, Regional Container sustained solid returns over the last few months and may actually be approaching a breakup point.

Prinsiri Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Prinsiri 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 forward-looking signals 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.

Pair Trading with Regional Container and Prinsiri Public

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

The idea behind Regional Container Lines and Prinsiri 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.