Correlation Between PTT Exploration and Intermedical Care

Can any of the company-specific risk be diversified away by investing in both PTT Exploration and Intermedical Care 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 PTT Exploration and Intermedical Care into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PTT Exploration and and Intermedical Care and, you can compare the effects of market volatilities on PTT Exploration and Intermedical Care 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 PTT Exploration with a short position of Intermedical Care. Check out your portfolio center. Please also check ongoing floating volatility patterns of PTT Exploration and Intermedical Care.

Diversification Opportunities for PTT Exploration and Intermedical Care

0.08

Correlation Coefficient

PTT Exploration  Intermedical Care

Significant diversification

The 3 months correlation between PTT and Intermedical is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding PTT Exploration and and Intermedical Care and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intermedical Care and PTT Exploration 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 PTT Exploration and are associated (or correlated) with Intermedical Care. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intermedical Care has no effect on the direction of PTT Exploration i.e., PTT Exploration and Intermedical Care go up and down completely randomly.

Pair Corralation between PTT Exploration and Intermedical Care

Assuming the 90 days trading horizon PTT Exploration and is expected to generate 1.44 times more return on investment than Intermedical Care. However, PTT Exploration is 1.44 times more volatile than Intermedical Care and. It trades about 0.07 of its potential returns per unit of risk. Intermedical Care and is currently generating about 0.05 per unit of risk. If you would invest  15,471  in PTT Exploration and on October 4, 2024 and sell it today you would lose (2,971) from holding PTT Exploration and or give up 19.2% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	95.94%
Values	Daily Returns

PTT Exploration and  vs.  Intermedical Care and

PTT Exploration

Risk-Adjusted Performance

0 of 100

OK

Over the last 90 days PTT Exploration and has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively weak technical and fundamental indicators, PTT Exploration reported solid returns over the last few months and may actually be approaching a breakup point.

Intermedical Care

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with PTT Exploration and Intermedical Care

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

The idea behind PTT Exploration and and Intermedical Care 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.

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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..