Correlation Between KGI Securities and Kiatnakin Phatra

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

By analyzing existing cross correlation between KGI Securities Public and Kiatnakin Phatra Bank, you can compare the effects of market volatilities on KGI Securities and Kiatnakin Phatra 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 KGI Securities with a short position of Kiatnakin Phatra. Check out your portfolio center. Please also check ongoing floating volatility patterns of KGI Securities and Kiatnakin Phatra.

Diversification Opportunities for KGI Securities and Kiatnakin Phatra

0.49

Correlation Coefficient

KGI Securities  Kiatnakin Phatra

Very weak diversification

The 3 months correlation between KGI and Kiatnakin is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding KGI Securities Public and Kiatnakin Phatra Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kiatnakin Phatra Bank and KGI Securities 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 KGI Securities Public are associated (or correlated) with Kiatnakin Phatra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kiatnakin Phatra Bank has no effect on the direction of KGI Securities i.e., KGI Securities and Kiatnakin Phatra go up and down completely randomly.

Pair Corralation between KGI Securities and Kiatnakin Phatra

Assuming the 90 days trading horizon KGI Securities is expected to generate 2.69 times less return on investment than Kiatnakin Phatra. But when comparing it to its historical volatility, KGI Securities Public is 2.67 times less risky than Kiatnakin Phatra. It trades about 0.08 of its potential returns per unit of risk. Kiatnakin Phatra Bank is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  5,050  in Kiatnakin Phatra Bank on October 20, 2024 and sell it today you would earn a total of  125.00  from holding Kiatnakin Phatra Bank or generate 2.48% return on investment over 90 days.

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

KGI Securities Public  vs.  Kiatnakin Phatra Bank

KGI Securities Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KGI Securities Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's forward indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Kiatnakin Phatra Bank

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kiatnakin Phatra Bank has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Kiatnakin Phatra is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with KGI Securities and Kiatnakin Phatra

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

The idea behind KGI Securities Public and Kiatnakin Phatra Bank 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.