Correlation Between PINTHONG INDUSTRIAL and Arinsiri Land

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

By analyzing existing cross correlation between PINTHONG INDUSTRIAL PARK and Arinsiri Land Public, you can compare the effects of market volatilities on PINTHONG INDUSTRIAL and Arinsiri Land 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 PINTHONG INDUSTRIAL with a short position of Arinsiri Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of PINTHONG INDUSTRIAL and Arinsiri Land.

Diversification Opportunities for PINTHONG INDUSTRIAL and Arinsiri Land

-0.66

Correlation Coefficient

PINTHONG INDUSTRIAL  Arinsiri Land

Excellent diversification

The 3 months correlation between PINTHONG and Arinsiri is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding PINTHONG INDUSTRIAL PARK and Arinsiri Land Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arinsiri Land Public and PINTHONG INDUSTRIAL 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 PINTHONG INDUSTRIAL PARK are associated (or correlated) with Arinsiri Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arinsiri Land Public has no effect on the direction of PINTHONG INDUSTRIAL i.e., PINTHONG INDUSTRIAL and Arinsiri Land go up and down completely randomly.

Pair Corralation between PINTHONG INDUSTRIAL and Arinsiri Land

Assuming the 90 days trading horizon PINTHONG INDUSTRIAL is expected to generate 44.21 times less return on investment than Arinsiri Land. But when comparing it to its historical volatility, PINTHONG INDUSTRIAL PARK is 29.0 times less risky than Arinsiri Land. It trades about 0.05 of its potential returns per unit of risk. Arinsiri Land Public is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  163.00  in Arinsiri Land Public on October 13, 2024 and sell it today you would lose (108.00) from holding Arinsiri Land Public or give up 66.26% of portfolio value over 90 days.

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

PINTHONG INDUSTRIAL PARK  vs.  Arinsiri Land Public

PINTHONG INDUSTRIAL PARK

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in PINTHONG INDUSTRIAL PARK are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, PINTHONG INDUSTRIAL may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Arinsiri Land Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Arinsiri Land Public 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 forward-looking signals remain quite persistent which may send shares a bit higher in February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with PINTHONG INDUSTRIAL and Arinsiri Land

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

The idea behind PINTHONG INDUSTRIAL PARK and Arinsiri Land 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.