Correlation Between 2S Metal and Kiatnakin Phatra

Can any of the company-specific risk be diversified away by investing in both 2S Metal and Kiatnakin Phatra 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 2S Metal and Kiatnakin Phatra into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between 2S Metal Public and Kiatnakin Phatra Bank, you can compare the effects of market volatilities on 2S Metal and Kiatnakin Phatra 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 2S Metal with a short position of Kiatnakin Phatra. Check out your portfolio center. Please also check ongoing floating volatility patterns of 2S Metal and Kiatnakin Phatra.

Diversification Opportunities for 2S Metal and Kiatnakin Phatra

0.62

Correlation Coefficient

2S Metal  Kiatnakin Phatra

Poor diversification

The 3 months correlation between 2S Metal and Kiatnakin is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding 2S Metal Public and Kiatnakin Phatra Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kiatnakin Phatra Bank and 2S 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 2S Metal Public are associated (or correlated) with Kiatnakin Phatra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kiatnakin Phatra Bank has no effect on the direction of 2S Metal i.e., 2S Metal and Kiatnakin Phatra go up and down completely randomly.

Pair Corralation between 2S Metal and Kiatnakin Phatra

Assuming the 90 days horizon 2S Metal Public is expected to under-perform the Kiatnakin Phatra. But the stock apears to be less risky and, when comparing its historical volatility, 2S Metal Public is 1.27 times less risky than Kiatnakin Phatra. The stock trades about -0.14 of its potential returns per unit of risk. The Kiatnakin Phatra Bank is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  5,150  in Kiatnakin Phatra Bank on October 11, 2024 and sell it today you would earn a total of  125.00  from holding Kiatnakin Phatra Bank or generate 2.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	95.0%
Values	Daily Returns

2S Metal Public  vs.  Kiatnakin Phatra Bank

2S Metal Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days 2S Metal 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 February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Kiatnakin Phatra Bank

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Kiatnakin Phatra Bank are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Kiatnakin Phatra is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with 2S Metal and Kiatnakin Phatra

The main advantage of trading using opposite 2S Metal and Kiatnakin Phatra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 2S Metal position performs unexpectedly, Kiatnakin Phatra 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 Kiatnakin Phatra will offset losses from the drop in Kiatnakin Phatra's long position.

The idea behind 2S Metal Public and Kiatnakin Phatra Bank 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.