Correlation Between RB Food and Krung Thai
Can any of the company-specific risk be diversified away by investing in both RB Food and Krung Thai 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 RB Food and Krung Thai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RB Food Supply and Krung Thai Bank, you can compare the effects of market volatilities on RB Food and Krung Thai 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 RB Food with a short position of Krung Thai. Check out your portfolio center. Please also check ongoing floating volatility patterns of RB Food and Krung Thai.
Diversification Opportunities for RB Food and Krung Thai
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between RBF and Krung is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding RB Food Supply and Krung Thai Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Krung Thai Bank and RB Food 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 RB Food Supply are associated (or correlated) with Krung Thai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Krung Thai Bank has no effect on the direction of RB Food i.e., RB Food and Krung Thai go up and down completely randomly.
Pair Corralation between RB Food and Krung Thai
Assuming the 90 days trading horizon RB Food Supply is expected to under-perform the Krung Thai. In addition to that, RB Food is 1.86 times more volatile than Krung Thai Bank. It trades about -0.17 of its total potential returns per unit of risk. Krung Thai Bank is currently generating about 0.13 per unit of volatility. If you would invest 2,000 in Krung Thai Bank on December 1, 2024 and sell it today you would earn a total of 250.00 from holding Krung Thai Bank or generate 12.5% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
RB Food Supply vs. Krung Thai Bank
Performance |
Timeline |
RB Food Supply |
Krung Thai Bank |
RB Food and Krung Thai Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with RB Food and Krung Thai
The main advantage of trading using opposite RB Food and Krung Thai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RB Food position performs unexpectedly, Krung Thai 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 Krung Thai will offset losses from the drop in Krung Thai's long position.RB Food vs. Osotspa Public | RB Food vs. Thai Union Group | RB Food vs. Carabao Group Public | RB Food vs. PTG Energy PCL |
Krung Thai vs. Bangkok Bank Public | Krung Thai vs. SCB X Public | Krung Thai vs. Kasikornbank Public | Krung Thai vs. PTT Public |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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