Correlation Between Kiatnakin Phatra and Kasikornbank Public

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

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

Diversification Opportunities for Kiatnakin Phatra and Kasikornbank Public

0.23

Correlation Coefficient

Kiatnakin Phatra  Kasikornbank Public

Modest diversification

The 3 months correlation between Kiatnakin and Kasikornbank is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Kiatnakin Phatra Bank and Kasikornbank Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kasikornbank Public and Kiatnakin Phatra 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 Kiatnakin Phatra Bank are associated (or correlated) with Kasikornbank Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kasikornbank Public has no effect on the direction of Kiatnakin Phatra i.e., Kiatnakin Phatra and Kasikornbank Public go up and down completely randomly.

Pair Corralation between Kiatnakin Phatra and Kasikornbank Public

Assuming the 90 days trading horizon Kiatnakin Phatra Bank is expected to under-perform the Kasikornbank Public. In addition to that, Kiatnakin Phatra is 1.23 times more volatile than Kasikornbank Public. It trades about -0.03 of its total potential returns per unit of risk. Kasikornbank Public is currently generating about 0.03 per unit of volatility. If you would invest  13,118  in Kasikornbank Public on September 3, 2024 and sell it today you would earn a total of  2,032  from holding Kasikornbank Public or generate 15.49% return on investment over 90 days.

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

Kiatnakin Phatra Bank  vs.  Kasikornbank Public

Kiatnakin Phatra Bank

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kiatnakin Phatra Bank are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Kiatnakin Phatra may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Kasikornbank Public

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Kasikornbank Public are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental drivers, Kasikornbank Public is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Kiatnakin Phatra and Kasikornbank Public

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

The idea behind Kiatnakin Phatra Bank and Kasikornbank Public 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.