Correlation Between Kingsmen CMTI and PTT Oil

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

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

Diversification Opportunities for Kingsmen CMTI and PTT Oil

-0.66

Correlation Coefficient

Kingsmen CMTI  PTT Oil

Excellent diversification

The 3 months correlation between Kingsmen and PTT is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Kingsmen CMTI 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 Kingsmen CMTI 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 Kingsmen CMTI 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 Kingsmen CMTI i.e., Kingsmen CMTI and PTT Oil go up and down completely randomly.

Pair Corralation between Kingsmen CMTI and PTT Oil

Given the investment horizon of 90 days Kingsmen CMTI Public is expected to generate 0.86 times more return on investment than PTT Oil. However, Kingsmen CMTI Public is 1.16 times less risky than PTT Oil. It trades about 0.16 of its potential returns per unit of risk. PTT Oil and is currently generating about -0.08 per unit of risk. If you would invest  121.00  in Kingsmen CMTI Public on December 28, 2024 and sell it today you would earn a total of  28.00  from holding Kingsmen CMTI Public or generate 23.14% return on investment over 90 days.

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

Kingsmen CMTI Public  vs.  PTT Oil and

Kingsmen CMTI Public

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Kingsmen CMTI Public are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting fundamental drivers, Kingsmen CMTI disclosed solid returns over the last few months and may actually be approaching a breakup point.

PTT Oil

Risk-Adjusted Performance

Very Weak

Over the last 90 days PTT Oil and 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 fundamental drivers remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Kingsmen CMTI and PTT Oil

The main advantage of trading using opposite Kingsmen CMTI and PTT Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kingsmen CMTI 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.

The idea behind Kingsmen CMTI Public and PTT Oil and 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.

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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.