Correlation Between Delta Electronics and PTT Oil
Can any of the company-specific risk be diversified away by investing in both Delta Electronics and PTT Oil 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 Delta Electronics and PTT Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delta Electronics Public and PTT Oil and, you can compare the effects of market volatilities on Delta Electronics and PTT Oil 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 Delta Electronics with a short position of PTT Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delta Electronics and PTT Oil.
Diversification Opportunities for Delta Electronics and PTT Oil
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Delta and PTT is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Delta Electronics Public and PTT Oil and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PTT Oil and Delta Electronics 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 Delta Electronics Public are associated (or correlated) with PTT Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PTT Oil has no effect on the direction of Delta Electronics i.e., Delta Electronics and PTT Oil go up and down completely randomly.
Pair Corralation between Delta Electronics and PTT Oil
Assuming the 90 days trading horizon Delta Electronics Public is expected to under-perform the PTT Oil. In addition to that, Delta Electronics is 1.8 times more volatile than PTT Oil and. It trades about -0.24 of its total potential returns per unit of risk. PTT Oil and is currently generating about -0.05 per unit of volatility. If you would invest 1,317 in PTT Oil and on December 29, 2024 and sell it today you would lose (127.00) from holding PTT Oil and or give up 9.64% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Delta Electronics Public vs. PTT Oil and
Performance |
Timeline |
Delta Electronics Public |
PTT Oil |
Delta Electronics and PTT Oil Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Delta Electronics and PTT Oil
The main advantage of trading using opposite Delta Electronics and PTT Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delta Electronics position performs unexpectedly, PTT Oil 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 PTT Oil will offset losses from the drop in PTT Oil's long position.Delta Electronics vs. Airports of Thailand | Delta Electronics vs. Hana Microelectronics Public | Delta Electronics vs. Advanced Info Service | Delta Electronics vs. Kasikornbank Public |
PTT Oil vs. PTT Public | PTT Oil vs. CP ALL Public | PTT Oil vs. Kasikornbank Public | PTT Oil vs. Airports of Thailand |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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