Correlation Between Kasikornbank Public and Airports

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

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

Diversification Opportunities for Kasikornbank Public and Airports

0.5

Correlation Coefficient

Kasikornbank Public  Airports

Very weak diversification

The 3 months correlation between Kasikornbank and Airports is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Kasikornbank Public and Airports of Thailand in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airports of Thailand and Kasikornbank 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 Kasikornbank Public are associated (or correlated) with Airports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airports of Thailand has no effect on the direction of Kasikornbank Public i.e., Kasikornbank Public and Airports go up and down completely randomly.

Pair Corralation between Kasikornbank Public and Airports

Assuming the 90 days trading horizon Kasikornbank Public is expected to generate 7.1 times less return on investment than Airports. But when comparing it to its historical volatility, Kasikornbank Public is 3.18 times less risky than Airports. It trades about 0.01 of its potential returns per unit of risk. Airports of Thailand is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  3,925  in Airports of Thailand on May 7, 2025 and sell it today you would earn a total of  50.00  from holding Airports of Thailand or generate 1.27% return on investment over 90 days.

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

Kasikornbank Public  vs.  Airports of Thailand

Kasikornbank Public

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kasikornbank Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental drivers, Kasikornbank Public is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Airports of Thailand

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Airports of Thailand are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Airports 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 Kasikornbank Public and Airports

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

The idea behind Kasikornbank Public and Airports of Thailand 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.