Correlation Between Praram 9 and Bangkok Expressway

Can any of the company-specific risk be diversified away by investing in both Praram 9 and Bangkok Expressway 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 Praram 9 and Bangkok Expressway into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Praram 9 Hospital and Bangkok Expressway and, you can compare the effects of market volatilities on Praram 9 and Bangkok Expressway 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 Praram 9 with a short position of Bangkok Expressway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Praram 9 and Bangkok Expressway.

Diversification Opportunities for Praram 9 and Bangkok Expressway

-0.88

Correlation Coefficient

Praram 9  Bangkok Expressway

Pay attention - limited upside

The 3 months correlation between Praram and Bangkok is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Praram 9 Hospital and Bangkok Expressway and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bangkok Expressway and and Praram 9 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 Praram 9 Hospital are associated (or correlated) with Bangkok Expressway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bangkok Expressway and has no effect on the direction of Praram 9 i.e., Praram 9 and Bangkok Expressway go up and down completely randomly.

Pair Corralation between Praram 9 and Bangkok Expressway

Assuming the 90 days trading horizon Praram 9 Hospital is expected to generate 0.99 times more return on investment than Bangkok Expressway. However, Praram 9 Hospital is 1.01 times less risky than Bangkok Expressway. It trades about 0.13 of its potential returns per unit of risk. Bangkok Expressway and is currently generating about -0.1 per unit of risk. If you would invest  2,525  in Praram 9 Hospital on October 10, 2024 and sell it today you would earn a total of  100.00  from holding Praram 9 Hospital or generate 3.96% return on investment over 90 days.

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

Praram 9 Hospital  vs.  Bangkok Expressway and

Praram 9 Hospital

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Praram 9 Hospital are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Praram 9 disclosed solid returns over the last few months and may actually be approaching a breakup point.

Bangkok Expressway and

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bangkok Expressway and has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental drivers remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Praram 9 and Bangkok Expressway

The main advantage of trading using opposite Praram 9 and Bangkok Expressway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Praram 9 position performs unexpectedly, Bangkok Expressway 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 Expressway will offset losses from the drop in Bangkok Expressway's long position.

The idea behind Praram 9 Hospital and Bangkok Expressway 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.