Correlation Between MFC Nichada and Multi National

Can any of the company-specific risk be diversified away by investing in both MFC Nichada and Multi National 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 MFC Nichada and Multi National into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between MFC Nichada Thani Property and Multi National Residence, you can compare the effects of market volatilities on MFC Nichada and Multi National 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 MFC Nichada with a short position of Multi National. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFC Nichada and Multi National.

Diversification Opportunities for MFC Nichada and Multi National

-0.25

Correlation Coefficient

MFC Nichada  Multi National

Very good diversification

The 3 months correlation between MFC and Multi is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding MFC Nichada Thani Property and Multi National Residence in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi National Residence and MFC Nichada 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 MFC Nichada Thani Property are associated (or correlated) with Multi National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi National Residence has no effect on the direction of MFC Nichada i.e., MFC Nichada and Multi National go up and down completely randomly.

Pair Corralation between MFC Nichada and Multi National

Assuming the 90 days trading horizon MFC Nichada is expected to generate 1.34 times less return on investment than Multi National. But when comparing it to its historical volatility, MFC Nichada Thani Property is 1.44 times less risky than Multi National. It trades about 0.04 of its potential returns per unit of risk. Multi National Residence is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  202.00  in Multi National Residence on April 23, 2025 and sell it today you would earn a total of  6.00  from holding Multi National Residence or generate 2.97% return on investment over 90 days.

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

MFC Nichada Thani Property  vs.  Multi National Residence

MFC Nichada Thani

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in MFC Nichada Thani Property are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, MFC Nichada is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Multi National Residence

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Multi National Residence are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, Multi National 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 MFC Nichada and Multi National

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

The idea behind MFC Nichada Thani Property and Multi National Residence 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.