Correlation Between Bangchak Public and TPI Polene

Can any of the company-specific risk be diversified away by investing in both Bangchak Public and TPI Polene 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 Bangchak Public and TPI Polene into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Bangchak Public and TPI Polene

0.22

Correlation Coefficient

Bangchak Public  TPI Polene

Modest diversification

The 3 months correlation between Bangchak and TPI is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Bangchak Public and TPI Polene Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TPI Polene Power and Bangchak Public 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 Bangchak Public are associated (or correlated) with TPI Polene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TPI Polene Power has no effect on the direction of Bangchak Public i.e., Bangchak Public and TPI Polene go up and down completely randomly.

Pair Corralation between Bangchak Public and TPI Polene

Assuming the 90 days trading horizon Bangchak Public is expected to under-perform the TPI Polene. In addition to that, Bangchak Public is 2.93 times more volatile than TPI Polene Power. It trades about -0.11 of its total potential returns per unit of risk. TPI Polene Power is currently generating about 0.06 per unit of volatility. If you would invest  293.00  in TPI Polene Power on September 4, 2024 and sell it today you would earn a total of  9.00  from holding TPI Polene Power or generate 3.07% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.41%
Values	Daily Returns

Bangchak Public  vs.  TPI Polene Power

Bangchak Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bangchak 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 basic indicators 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.

TPI Polene Power

Risk-Adjusted Performance

5 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in TPI Polene Power are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental drivers, TPI Polene is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Bangchak Public and TPI Polene

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

The idea behind Bangchak Public and TPI Polene Power 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.