Correlation Between Information and Bualuang Office

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

By analyzing existing cross correlation between Information and Communication and Bualuang Office Leasehold, you can compare the effects of market volatilities on Information and Bualuang Office 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 Information with a short position of Bualuang Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of Information and Bualuang Office.

Diversification Opportunities for Information and Bualuang Office

0.07

Correlation Coefficient

Information  Bualuang Office

Significant diversification

The 3 months correlation between Information and Bualuang is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Information and Communication and Bualuang Office Leasehold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bualuang Office Leasehold and Information 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 Information and Communication are associated (or correlated) with Bualuang Office. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bualuang Office Leasehold has no effect on the direction of Information i.e., Information and Bualuang Office go up and down completely randomly.

Pair Corralation between Information and Bualuang Office

Assuming the 90 days trading horizon Information and Communication is expected to generate 1.5 times more return on investment than Bualuang Office. However, Information is 1.5 times more volatile than Bualuang Office Leasehold. It trades about 0.02 of its potential returns per unit of risk. Bualuang Office Leasehold is currently generating about -0.02 per unit of risk. If you would invest  192.00  in Information and Communication on December 26, 2024 and sell it today you would earn a total of  2.00  from holding Information and Communication or generate 1.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Information and Communication  vs.  Bualuang Office Leasehold

Information and Comm

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Information and Communication are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Information is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Bualuang Office Leasehold

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bualuang Office Leasehold has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Bualuang Office is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Information and Bualuang Office

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

The idea behind Information and Communication and Bualuang Office Leasehold 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.