Correlation Between KT Medical and S Khonkaen

Can any of the company-specific risk be diversified away by investing in both KT Medical and S Khonkaen 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 KT Medical and S Khonkaen into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between KT Medical Service and S Khonkaen Foods, you can compare the effects of market volatilities on KT Medical and S Khonkaen 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 KT Medical with a short position of S Khonkaen. Check out your portfolio center. Please also check ongoing floating volatility patterns of KT Medical and S Khonkaen.

Diversification Opportunities for KT Medical and S Khonkaen

-0.49

Correlation Coefficient

KT Medical  S Khonkaen

Very good diversification

The 3 months correlation between KTMS and SORKON is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding KT Medical Service and S Khonkaen Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on S Khonkaen Foods and KT Medical 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 KT Medical Service are associated (or correlated) with S Khonkaen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of S Khonkaen Foods has no effect on the direction of KT Medical i.e., KT Medical and S Khonkaen go up and down completely randomly.

Pair Corralation between KT Medical and S Khonkaen

Assuming the 90 days trading horizon KT Medical Service is expected to generate 2.55 times more return on investment than S Khonkaen. However, KT Medical is 2.55 times more volatile than S Khonkaen Foods. It trades about 0.17 of its potential returns per unit of risk. S Khonkaen Foods is currently generating about -0.08 per unit of risk. If you would invest  156.00  in KT Medical Service on April 25, 2025 and sell it today you would earn a total of  42.00  from holding KT Medical Service or generate 26.92% return on investment over 90 days.

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

KT Medical Service  vs.  S Khonkaen Foods

KT Medical Service

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in KT Medical Service are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite quite weak forward-looking signals, KT Medical disclosed solid returns over the last few months and may actually be approaching a breakup point.

S Khonkaen Foods

Risk-Adjusted Performance

Very Weak

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

Pair Trading with KT Medical and S Khonkaen

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

The idea behind KT Medical Service and S Khonkaen Foods 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.