Correlation Between Carbios and Internet Thailand
Can any of the company-specific risk be diversified away by investing in both Carbios and Internet Thailand 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 Carbios and Internet Thailand into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carbios and Internet Thailand PCL, you can compare the effects of market volatilities on Carbios and Internet Thailand 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 Carbios with a short position of Internet Thailand. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carbios and Internet Thailand.
Diversification Opportunities for Carbios and Internet Thailand
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Carbios and Internet is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Carbios and Internet Thailand PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Internet Thailand PCL and Carbios 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 Carbios are associated (or correlated) with Internet Thailand. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Internet Thailand PCL has no effect on the direction of Carbios i.e., Carbios and Internet Thailand go up and down completely randomly.
Pair Corralation between Carbios and Internet Thailand
Assuming the 90 days horizon Carbios is expected to generate 1.88 times more return on investment than Internet Thailand. However, Carbios is 1.88 times more volatile than Internet Thailand PCL. It trades about 0.09 of its potential returns per unit of risk. Internet Thailand PCL is currently generating about 0.13 per unit of risk. If you would invest 774.00 in Carbios on September 15, 2024 and sell it today you would earn a total of 75.00 from holding Carbios or generate 9.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Carbios vs. Internet Thailand PCL
Performance |
| Timeline |
| Carbios |
| Internet Thailand PCL |
Carbios and Internet Thailand Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carbios and Internet Thailand
The main advantage of trading using opposite Carbios and Internet Thailand positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carbios position performs unexpectedly, Internet Thailand 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 Internet Thailand will offset losses from the drop in Internet Thailand's long position.| Carbios vs. Internet Thailand PCL | Carbios vs. TIANDE CHEMICAL | Carbios vs. Computershare Limited | Carbios vs. SEKISUI CHEMICAL |
| Internet Thailand vs. Apple Inc | Internet Thailand vs. Apple Inc | Internet Thailand vs. Apple Inc | Internet Thailand vs. Apple Inc |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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