Correlation Between Hydrogen Freehold and MFC Nichada

Can any of the company-specific risk be diversified away by investing in both Hydrogen Freehold and MFC Nichada 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 Hydrogen Freehold and MFC Nichada into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Hydrogen Freehold Leasehold and MFC Nichada Thani Property, you can compare the effects of market volatilities on Hydrogen Freehold and MFC Nichada 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 Hydrogen Freehold with a short position of MFC Nichada. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hydrogen Freehold and MFC Nichada.

Diversification Opportunities for Hydrogen Freehold and MFC Nichada

0.15

Correlation Coefficient

Hydrogen Freehold  MFC Nichada

Average diversification

The 3 months correlation between Hydrogen and MFC is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Hydrogen Freehold Leasehold and MFC Nichada Thani Property in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MFC Nichada Thani and Hydrogen Freehold 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 Hydrogen Freehold Leasehold are associated (or correlated) with MFC Nichada. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MFC Nichada Thani has no effect on the direction of Hydrogen Freehold i.e., Hydrogen Freehold and MFC Nichada go up and down completely randomly.

Pair Corralation between Hydrogen Freehold and MFC Nichada

Assuming the 90 days trading horizon Hydrogen Freehold is expected to generate 3799.5 times less return on investment than MFC Nichada. But when comparing it to its historical volatility, Hydrogen Freehold Leasehold is 211.7 times less risky than MFC Nichada. It trades about 0.03 of its potential returns per unit of risk. MFC Nichada Thani Property is currently generating about 0.48 of returns per unit of risk over similar time horizon. If you would invest  461.00  in MFC Nichada Thani Property on September 13, 2024 and sell it today you would earn a total of  39.00  from holding MFC Nichada Thani Property or generate 8.46% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	83.33%
Values	Daily Returns

Hydrogen Freehold Leasehold  vs.  MFC Nichada Thani Property

Hydrogen Freehold

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Hydrogen Freehold Leasehold are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Hydrogen Freehold is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

MFC Nichada Thani

Risk-Adjusted Performance

38 of 100

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in MFC Nichada Thani Property are ranked lower than 38 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak fundamental drivers, MFC Nichada sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Hydrogen Freehold and MFC Nichada

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

The idea behind Hydrogen Freehold Leasehold and MFC Nichada Thani Property 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 Transaction History module to view history of all your transactions and understand their impact on performance.