Correlation Between Thai Energy and TISCO Financial
Can any of the company-specific risk be diversified away by investing in both Thai Energy and TISCO Financial 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 Thai Energy and TISCO Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thai Energy Storage and TISCO Financial Group, you can compare the effects of market volatilities on Thai Energy and TISCO Financial 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 Thai Energy with a short position of TISCO Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Energy and TISCO Financial.
Diversification Opportunities for Thai Energy and TISCO Financial
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Thai and TISCO is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Thai Energy Storage and TISCO Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TISCO Financial Group and Thai Energy 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 Thai Energy Storage are associated (or correlated) with TISCO Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TISCO Financial Group has no effect on the direction of Thai Energy i.e., Thai Energy and TISCO Financial go up and down completely randomly.
Pair Corralation between Thai Energy and TISCO Financial
Assuming the 90 days trading horizon Thai Energy Storage is expected to generate 1.01 times more return on investment than TISCO Financial. However, Thai Energy is 1.01 times more volatile than TISCO Financial Group. It trades about 0.07 of its potential returns per unit of risk. TISCO Financial Group is currently generating about -0.12 per unit of risk. If you would invest 5,350 in Thai Energy Storage on August 29, 2024 and sell it today you would earn a total of 25.00 from holding Thai Energy Storage or generate 0.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thai Energy Storage vs. TISCO Financial Group
Performance |
| Timeline |
| Thai Energy Storage |
| TISCO Financial Group |
Thai Energy and TISCO Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Energy and TISCO Financial
The main advantage of trading using opposite Thai Energy and TISCO Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Energy position performs unexpectedly, TISCO Financial 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 TISCO Financial will offset losses from the drop in TISCO Financial's long position.| Thai Energy vs. AJ Advance Technology | Thai Energy vs. Asia Precision Public | Thai Energy vs. Asia Metal Public | Thai Energy vs. The Erawan Group |
| TISCO Financial vs. Thai Energy Storage | TISCO Financial vs. Royal Orchid Hotel | TISCO Financial vs. Grand Canal Land | TISCO Financial vs. PRG Public |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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