Correlation Between Morgan Advanced and Bangkok Dusit

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

By analyzing existing cross correlation between Morgan Advanced Materials and Bangkok Dusit Medical, you can compare the effects of market volatilities on Morgan Advanced and Bangkok Dusit 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 Morgan Advanced with a short position of Bangkok Dusit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Morgan Advanced and Bangkok Dusit.

Diversification Opportunities for Morgan Advanced and Bangkok Dusit

0.0

Correlation Coefficient

Morgan Advanced  Bangkok Dusit

Pay attention - limited upside

The 3 months correlation between Morgan and Bangkok is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Morgan Advanced Materials and Bangkok Dusit Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bangkok Dusit Medical and Morgan Advanced 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 Morgan Advanced Materials are associated (or correlated) with Bangkok Dusit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bangkok Dusit Medical has no effect on the direction of Morgan Advanced i.e., Morgan Advanced and Bangkok Dusit go up and down completely randomly.

Pair Corralation between Morgan Advanced and Bangkok Dusit

If you would invest  3,233  in Bangkok Dusit Medical on October 10, 2024 and sell it today you would earn a total of  0.00  from holding Bangkok Dusit Medical or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.31%
Values	Daily Returns

Morgan Advanced Materials  vs.  Bangkok Dusit Medical

Morgan Advanced Materials

Risk-Adjusted Performance

0 of 100

Very Weak

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

Bangkok Dusit Medical

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bangkok Dusit Medical has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Bangkok Dusit is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Morgan Advanced and Bangkok Dusit

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

The idea behind Morgan Advanced Materials and Bangkok Dusit Medical 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.