Correlation Between Bangkok Dusit and Ingress Industrial

Can any of the company-specific risk be diversified away by investing in both Bangkok Dusit and Ingress Industrial 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 Bangkok Dusit and Ingress Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Bangkok Dusit Medical and Ingress Industrial Public, you can compare the effects of market volatilities on Bangkok Dusit and Ingress Industrial 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 Bangkok Dusit with a short position of Ingress Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bangkok Dusit and Ingress Industrial.

Diversification Opportunities for Bangkok Dusit and Ingress Industrial

0.83

Correlation Coefficient

Bangkok Dusit  Ingress Industrial

Very poor diversification

The 3 months correlation between Bangkok and Ingress is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Bangkok Dusit Medical and Ingress Industrial Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ingress Industrial Public and Bangkok Dusit 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 Bangkok Dusit Medical are associated (or correlated) with Ingress Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ingress Industrial Public has no effect on the direction of Bangkok Dusit i.e., Bangkok Dusit and Ingress Industrial go up and down completely randomly.

Pair Corralation between Bangkok Dusit and Ingress Industrial

Assuming the 90 days trading horizon Bangkok Dusit Medical is expected to under-perform the Ingress Industrial. But the stock apears to be less risky and, when comparing its historical volatility, Bangkok Dusit Medical is 1.68 times less risky than Ingress Industrial. The stock trades about -0.24 of its potential returns per unit of risk. The Ingress Industrial Public is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  32.00  in Ingress Industrial Public on September 25, 2024 and sell it today you would earn a total of  2.00  from holding Ingress Industrial Public or generate 6.25% return on investment over 90 days.

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

Bangkok Dusit Medical  vs.  Ingress Industrial Public

Bangkok Dusit Medical

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bangkok Dusit Medical 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.

Ingress Industrial Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ingress Industrial Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental drivers remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Bangkok Dusit and Ingress Industrial

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

The idea behind Bangkok Dusit Medical and Ingress Industrial 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.