Correlation Between PTT Public and Synergetic Auto

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

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

Diversification Opportunities for PTT Public and Synergetic Auto

-0.55

Correlation Coefficient

PTT Public  Synergetic Auto

Excellent diversification

The 3 months correlation between PTT and Synergetic is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding PTT Public and Synergetic Auto Performance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Synergetic Auto Perf and PTT Public 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 PTT Public are associated (or correlated) with Synergetic Auto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Synergetic Auto Perf has no effect on the direction of PTT Public i.e., PTT Public and Synergetic Auto go up and down completely randomly.

Pair Corralation between PTT Public and Synergetic Auto

Assuming the 90 days trading horizon PTT Public is expected to under-perform the Synergetic Auto. But the stock apears to be less risky and, when comparing its historical volatility, PTT Public is 1.4 times less risky than Synergetic Auto. The stock trades about -0.2 of its potential returns per unit of risk. The Synergetic Auto Performance is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest  298.00  in Synergetic Auto Performance on February 12, 2024 and sell it today you would earn a total of  18.00  from holding Synergetic Auto Performance or generate 6.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	94.12%
Values	Daily Returns

PTT Public  vs.  Synergetic Auto Performance

PTT Public

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in PTT Public are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, PTT Public is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Synergetic Auto Perf

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with PTT Public and Synergetic Auto

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

The idea behind PTT Public and Synergetic Auto Performance 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.