Correlation Between PTT Exploration and Amata Summit

Can any of the company-specific risk be diversified away by investing in both PTT Exploration and Amata Summit 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 Amata Summit 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 Amata Summit Growth, you can compare the effects of market volatilities on PTT Exploration and Amata Summit 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 Amata Summit. Check out your portfolio center. Please also check ongoing floating volatility patterns of PTT Exploration and Amata Summit.

Diversification Opportunities for PTT Exploration and Amata Summit

0.43

Correlation Coefficient

PTT Exploration  Amata Summit

Very weak diversification

The 3 months correlation between PTT and Amata is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding PTT Exploration and and Amata Summit Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amata Summit Growth 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 Amata Summit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amata Summit Growth has no effect on the direction of PTT Exploration i.e., PTT Exploration and Amata Summit go up and down completely randomly.

Pair Corralation between PTT Exploration and Amata Summit

Assuming the 90 days trading horizon PTT Exploration and is expected to generate 1.03 times more return on investment than Amata Summit. However, PTT Exploration is 1.03 times more volatile than Amata Summit Growth. It trades about 0.03 of its potential returns per unit of risk. Amata Summit Growth is currently generating about -0.02 per unit of risk. If you would invest  11,412  in PTT Exploration and on December 30, 2024 and sell it today you would earn a total of  288.00  from holding PTT Exploration and or generate 2.52% return on investment over 90 days.

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

PTT Exploration and  vs.  Amata Summit Growth

PTT Exploration

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in PTT Exploration and are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental drivers, PTT Exploration is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Amata Summit Growth

Risk-Adjusted Performance

Very Weak

Over the last 90 days Amata Summit Growth has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Amata Summit is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with PTT Exploration and Amata Summit

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

The idea behind PTT Exploration and and Amata Summit Growth 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.