Correlation Between Rojana Industrial and Ramkhamhaeng Hospital

Can any of the company-specific risk be diversified away by investing in both Rojana Industrial and Ramkhamhaeng Hospital 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 Rojana Industrial and Ramkhamhaeng Hospital into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Rojana Industrial Park and Ramkhamhaeng Hospital Public, you can compare the effects of market volatilities on Rojana Industrial and Ramkhamhaeng Hospital 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 Rojana Industrial with a short position of Ramkhamhaeng Hospital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rojana Industrial and Ramkhamhaeng Hospital.

Diversification Opportunities for Rojana Industrial and Ramkhamhaeng Hospital

0.56

Correlation Coefficient

Rojana Industrial  Ramkhamhaeng Hospital

Very weak diversification

The 3 months correlation between Rojana and Ramkhamhaeng is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Rojana Industrial Park and Ramkhamhaeng Hospital Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ramkhamhaeng Hospital and Rojana 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 Rojana Industrial Park are associated (or correlated) with Ramkhamhaeng Hospital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ramkhamhaeng Hospital has no effect on the direction of Rojana Industrial i.e., Rojana Industrial and Ramkhamhaeng Hospital go up and down completely randomly.

Pair Corralation between Rojana Industrial and Ramkhamhaeng Hospital

Assuming the 90 days trading horizon Rojana Industrial Park is expected to generate 1.48 times more return on investment than Ramkhamhaeng Hospital. However, Rojana Industrial is 1.48 times more volatile than Ramkhamhaeng Hospital Public. It trades about 0.01 of its potential returns per unit of risk. Ramkhamhaeng Hospital Public is currently generating about -0.11 per unit of risk. If you would invest  577.00  in Rojana Industrial Park on October 11, 2024 and sell it today you would earn a total of  13.00  from holding Rojana Industrial Park or generate 2.25% return on investment over 90 days.

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

Rojana Industrial Park  vs.  Ramkhamhaeng Hospital Public

Rojana Industrial Park

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Rojana Industrial Park 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 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.

Ramkhamhaeng Hospital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ramkhamhaeng Hospital Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent primary indicators, Ramkhamhaeng Hospital is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Rojana Industrial and Ramkhamhaeng Hospital

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

The idea behind Rojana Industrial Park and Ramkhamhaeng Hospital 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.