Correlation Between AOYAMA TRADING and Internet Thailand
Can any of the company-specific risk be diversified away by investing in both AOYAMA TRADING 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 AOYAMA TRADING and Internet Thailand into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AOYAMA TRADING and Internet Thailand PCL, you can compare the effects of market volatilities on AOYAMA TRADING 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 AOYAMA TRADING with a short position of Internet Thailand. Check out your portfolio center. Please also check ongoing floating volatility patterns of AOYAMA TRADING and Internet Thailand.
Diversification Opportunities for AOYAMA TRADING and Internet Thailand
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between AOYAMA and Internet is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding AOYAMA TRADING 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 AOYAMA TRADING 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 AOYAMA TRADING 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 AOYAMA TRADING i.e., AOYAMA TRADING and Internet Thailand go up and down completely randomly.
Pair Corralation between AOYAMA TRADING and Internet Thailand
Assuming the 90 days horizon AOYAMA TRADING is expected to generate 1.35 times less return on investment than Internet Thailand. But when comparing it to its historical volatility, AOYAMA TRADING is 1.02 times less risky than Internet Thailand. It trades about 0.09 of its potential returns per unit of risk. Internet Thailand PCL is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 11.00 in Internet Thailand PCL on August 25, 2024 and sell it today you would earn a total of 8.00 from holding Internet Thailand PCL or generate 72.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
AOYAMA TRADING vs. Internet Thailand PCL
Performance |
| Timeline |
| AOYAMA TRADING |
| Internet Thailand PCL |
AOYAMA TRADING and Internet Thailand Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AOYAMA TRADING and Internet Thailand
The main advantage of trading using opposite AOYAMA TRADING and Internet Thailand positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AOYAMA TRADING 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.| AOYAMA TRADING vs. FAST RETAIL ADR | AOYAMA TRADING vs. J JILL INC | AOYAMA TRADING vs. Superior Plus Corp | AOYAMA TRADING vs. NMI Holdings |
| Internet Thailand vs. Gladstone Investment | Internet Thailand vs. ECHO INVESTMENT ZY | Internet Thailand vs. Vastned Retail NV | Internet Thailand vs. AOYAMA TRADING |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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