Correlation Between Ngern Tid and Bangchak Public

Can any of the company-specific risk be diversified away by investing in both Ngern Tid and Bangchak Public 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 Ngern Tid and Bangchak Public into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ngern Tid Lor and Bangchak Public, you can compare the effects of market volatilities on Ngern Tid and Bangchak Public 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 Ngern Tid with a short position of Bangchak Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ngern Tid and Bangchak Public.

Diversification Opportunities for Ngern Tid and Bangchak Public

-0.33

Correlation Coefficient

Ngern Tid  Bangchak Public

Very good diversification

The 3 months correlation between Ngern and Bangchak is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Ngern Tid Lor and Bangchak Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bangchak Public and Ngern Tid 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 Ngern Tid Lor are associated (or correlated) with Bangchak Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bangchak Public has no effect on the direction of Ngern Tid i.e., Ngern Tid and Bangchak Public go up and down completely randomly.

Pair Corralation between Ngern Tid and Bangchak Public

Assuming the 90 days trading horizon Ngern Tid Lor is expected to generate 3.12 times more return on investment than Bangchak Public. However, Ngern Tid is 3.12 times more volatile than Bangchak Public. It trades about 0.07 of its potential returns per unit of risk. Bangchak Public is currently generating about -0.02 per unit of risk. If you would invest  1,460  in Ngern Tid Lor on April 23, 2025 and sell it today you would earn a total of  290.00  from holding Ngern Tid Lor or generate 19.86% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.31%
Values	Daily Returns

Ngern Tid Lor  vs.  Bangchak Public

Ngern Tid Lor

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Ngern Tid Lor are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat conflicting fundamental indicators, Ngern Tid sustained solid returns over the last few months and may actually be approaching a breakup point.

Bangchak Public

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bangchak Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Bangchak Public 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 Ngern Tid and Bangchak Public

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

The idea behind Ngern Tid Lor and Bangchak 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.

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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.