Correlation Between Boutique Newcity and Krung Thai

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Can any of the company-specific risk be diversified away by investing in both Boutique Newcity and Krung Thai 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 Boutique Newcity and Krung Thai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boutique Newcity Public and Krung Thai Bank, you can compare the effects of market volatilities on Boutique Newcity and Krung Thai 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 Boutique Newcity with a short position of Krung Thai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boutique Newcity and Krung Thai.

Diversification Opportunities for Boutique Newcity and Krung Thai

BoutiqueKrungDiversified AwayBoutiqueKrungDiversified Away100%
-0.79
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Boutique and Krung is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Boutique Newcity Public and Krung Thai Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Krung Thai Bank and Boutique Newcity 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 Boutique Newcity Public are associated (or correlated) with Krung Thai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Krung Thai Bank has no effect on the direction of Boutique Newcity i.e., Boutique Newcity and Krung Thai go up and down completely randomly.

Pair Corralation between Boutique Newcity and Krung Thai

Assuming the 90 days trading horizon Boutique Newcity Public is expected to under-perform the Krung Thai. In addition to that, Boutique Newcity is 2.2 times more volatile than Krung Thai Bank. It trades about -0.07 of its total potential returns per unit of risk. Krung Thai Bank is currently generating about 0.15 per unit of volatility. If you would invest  2,040  in Krung Thai Bank on November 20, 2024 and sell it today you would earn a total of  270.00  from holding Krung Thai Bank or generate 13.24% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Boutique Newcity Public  vs.  Krung Thai Bank

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -15-10-5051015
JavaScript chart by amCharts 3.21.15BTNC KTB
       Timeline  
Boutique Newcity Public 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Boutique Newcity 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 March 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb1415161718192021
Krung Thai Bank 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Krung Thai Bank are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting fundamental drivers, Krung Thai disclosed solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb2020.52121.52222.52323.524

Boutique Newcity and Krung Thai Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-5.19-3.88-2.58-1.280.01.152.353.544.745.93 0.050.100.150.20
JavaScript chart by amCharts 3.21.15BTNC KTB
       Returns  

Pair Trading with Boutique Newcity and Krung Thai

The main advantage of trading using opposite Boutique Newcity and Krung Thai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boutique Newcity position performs unexpectedly, Krung Thai 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 Krung Thai will offset losses from the drop in Krung Thai's long position.
The idea behind Boutique Newcity Public and Krung Thai 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 Commodity Directory module to find actively traded commodities issued by global exchanges.

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