Correlation Between Altair Engineering and THAI BEVERAGE
Can any of the company-specific risk be diversified away by investing in both Altair Engineering 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 Altair Engineering and THAI BEVERAGE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Altair Engineering and THAI BEVERAGE, you can compare the effects of market volatilities on Altair Engineering 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 Altair Engineering with a short position of THAI BEVERAGE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altair Engineering and THAI BEVERAGE.
Diversification Opportunities for Altair Engineering and THAI BEVERAGE
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Altair and THAI is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Altair Engineering and THAI BEVERAGE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on THAI BEVERAGE and Altair Engineering 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 Altair Engineering 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 Altair Engineering i.e., Altair Engineering and THAI BEVERAGE go up and down completely randomly.
Pair Corralation between Altair Engineering and THAI BEVERAGE
Assuming the 90 days horizon Altair Engineering is expected to generate 2.18 times less return on investment than THAI BEVERAGE. But when comparing it to its historical volatility, Altair Engineering is 2.41 times less risky than THAI BEVERAGE. It trades about 0.08 of its potential returns per unit of risk. THAI BEVERAGE is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 18.00 in THAI BEVERAGE on September 14, 2024 and sell it today you would earn a total of 20.00 from holding THAI BEVERAGE or generate 111.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Altair Engineering vs. THAI BEVERAGE
Performance |
| Timeline |
| Altair Engineering |
| THAI BEVERAGE |
Altair Engineering and THAI BEVERAGE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Altair Engineering and THAI BEVERAGE
The main advantage of trading using opposite Altair Engineering and THAI BEVERAGE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altair Engineering 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.| Altair Engineering vs. Adyen NV | Altair Engineering vs. Superior Plus Corp | Altair Engineering vs. SIVERS SEMICONDUCTORS AB | Altair Engineering vs. Norsk Hydro ASA |
| THAI BEVERAGE vs. Apple Inc | THAI BEVERAGE vs. Apple Inc | THAI BEVERAGE vs. Apple Inc | THAI BEVERAGE 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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