Correlation Between Asset World and OHTL Public
Can any of the company-specific risk be diversified away by investing in both Asset World and OHTL 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 Asset World and OHTL Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asset World Corp and OHTL Public, you can compare the effects of market volatilities on Asset World and OHTL 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 Asset World with a short position of OHTL Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asset World and OHTL Public.
Diversification Opportunities for Asset World and OHTL Public
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Asset and OHTL is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Asset World Corp and OHTL Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OHTL Public and Asset World 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 Asset World Corp are associated (or correlated) with OHTL Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OHTL Public has no effect on the direction of Asset World i.e., Asset World and OHTL Public go up and down completely randomly.
Pair Corralation between Asset World and OHTL Public
Assuming the 90 days trading horizon Asset World Corp is expected to under-perform the OHTL Public. But the stock apears to be less risky and, when comparing its historical volatility, Asset World Corp is 1.33 times less risky than OHTL Public. The stock trades about -0.22 of its potential returns per unit of risk. The OHTL Public is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 34,600 in OHTL Public on December 3, 2024 and sell it today you would lose (2,800) from holding OHTL Public or give up 8.09% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Asset World Corp vs. OHTL Public
Performance |
Timeline |
Asset World Corp |
OHTL Public |
Asset World and OHTL Public Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Asset World and OHTL Public
The main advantage of trading using opposite Asset World and OHTL Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asset World position performs unexpectedly, OHTL 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 OHTL Public will offset losses from the drop in OHTL Public's long position.Asset World vs. Central Retail | Asset World vs. Gulf Energy Development | Asset World vs. BTS Group Holdings | Asset World vs. Bangkok Expressway and |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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