Correlation Between Identiv and Banpu PCL

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

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

Diversification Opportunities for Identiv and Banpu PCL

0.65

Correlation Coefficient

Identiv  Banpu PCL

Poor diversification

The 3 months correlation between Identiv and Banpu is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Identiv and Banpu PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banpu PCL and Identiv 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 Identiv are associated (or correlated) with Banpu PCL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banpu PCL has no effect on the direction of Identiv i.e., Identiv and Banpu PCL go up and down completely randomly.

Pair Corralation between Identiv and Banpu PCL

Assuming the 90 days trading horizon Identiv is expected to generate 0.76 times more return on investment than Banpu PCL. However, Identiv is 1.31 times less risky than Banpu PCL. It trades about -0.03 of its potential returns per unit of risk. Banpu PCL is currently generating about -0.08 per unit of risk. If you would invest  350.00  in Identiv on December 22, 2024 and sell it today you would lose (37.00) from holding Identiv or give up 10.57% of portfolio value over 90 days.

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

Identiv  vs.  Banpu PCL

Identiv

Risk-Adjusted Performance

Very Weak

Over the last 90 days Identiv has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Banpu PCL

Risk-Adjusted Performance

Very Weak

Over the last 90 days Banpu PCL has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Identiv and Banpu PCL

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

The idea behind Identiv and Banpu PCL 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.