Correlation Between TOWNSQUARE MEDIA and THAI BEVERAGE

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both TOWNSQUARE MEDIA and THAI BEVERAGE 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 TOWNSQUARE MEDIA and THAI BEVERAGE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TOWNSQUARE MEDIA INC and THAI BEVERAGE, you can compare the effects of market volatilities on TOWNSQUARE MEDIA and THAI BEVERAGE 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 TOWNSQUARE MEDIA with a short position of THAI BEVERAGE. Check out your portfolio center. Please also check ongoing floating volatility patterns of TOWNSQUARE MEDIA and THAI BEVERAGE.

Diversification Opportunities for TOWNSQUARE MEDIA and THAI BEVERAGE

0.41
  Correlation Coefficient

Very weak diversification

The 3 months correlation between TOWNSQUARE and THAI is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding TOWNSQUARE MEDIA INC and THAI BEVERAGE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on THAI BEVERAGE and TOWNSQUARE MEDIA 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 TOWNSQUARE MEDIA INC are associated (or correlated) with THAI BEVERAGE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of THAI BEVERAGE has no effect on the direction of TOWNSQUARE MEDIA i.e., TOWNSQUARE MEDIA and THAI BEVERAGE go up and down completely randomly.

Pair Corralation between TOWNSQUARE MEDIA and THAI BEVERAGE

Assuming the 90 days trading horizon TOWNSQUARE MEDIA is expected to generate 4.04 times less return on investment than THAI BEVERAGE. But when comparing it to its historical volatility, TOWNSQUARE MEDIA INC is 1.03 times less risky than THAI BEVERAGE. It trades about 0.02 of its potential returns per unit of risk. THAI BEVERAGE is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  31.00  in THAI BEVERAGE on September 19, 2024 and sell it today you would earn a total of  6.00  from holding THAI BEVERAGE or generate 19.35% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

TOWNSQUARE MEDIA INC  vs.  THAI BEVERAGE

 Performance 
       Timeline  
TOWNSQUARE MEDIA INC 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in TOWNSQUARE MEDIA INC are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, TOWNSQUARE MEDIA may actually be approaching a critical reversion point that can send shares even higher in January 2025.
THAI BEVERAGE 

Risk-Adjusted Performance

3 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in THAI BEVERAGE are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, THAI BEVERAGE may actually be approaching a critical reversion point that can send shares even higher in January 2025.

TOWNSQUARE MEDIA and THAI BEVERAGE Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with TOWNSQUARE MEDIA and THAI BEVERAGE

The main advantage of trading using opposite TOWNSQUARE MEDIA and THAI BEVERAGE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TOWNSQUARE MEDIA position performs unexpectedly, THAI BEVERAGE 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 THAI BEVERAGE will offset losses from the drop in THAI BEVERAGE's long position.
The idea behind TOWNSQUARE MEDIA INC and THAI BEVERAGE 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.

Other Complementary Tools

Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
AI Portfolio Architect
Use AI to generate optimal portfolios and find profitable investment opportunities
Global Correlations
Find global opportunities by holding instruments from different markets
Investing Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
Stock Screener
Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook.