Correlation Between Asian Alliance and AEON Thana
Can any of the company-specific risk be diversified away by investing in both Asian Alliance and AEON Thana 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 Asian Alliance and AEON Thana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asian Alliance International and AEON Thana Sinsap, you can compare the effects of market volatilities on Asian Alliance and AEON Thana 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 Asian Alliance with a short position of AEON Thana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asian Alliance and AEON Thana.
Diversification Opportunities for Asian Alliance and AEON Thana
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Asian and AEON is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Asian Alliance International and AEON Thana Sinsap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEON Thana Sinsap and Asian Alliance 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 Asian Alliance International are associated (or correlated) with AEON Thana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEON Thana Sinsap has no effect on the direction of Asian Alliance i.e., Asian Alliance and AEON Thana go up and down completely randomly.
Pair Corralation between Asian Alliance and AEON Thana
Assuming the 90 days trading horizon Asian Alliance International is expected to generate 1.08 times more return on investment than AEON Thana. However, Asian Alliance is 1.08 times more volatile than AEON Thana Sinsap. It trades about -0.12 of its potential returns per unit of risk. AEON Thana Sinsap is currently generating about -0.19 per unit of risk. If you would invest 615.00 in Asian Alliance International on September 5, 2024 and sell it today you would lose (35.00) from holding Asian Alliance International or give up 5.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asian Alliance International vs. AEON Thana Sinsap
Performance |
| Timeline |
| Asian Alliance Inter |
| AEON Thana Sinsap |
Asian Alliance and AEON Thana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asian Alliance and AEON Thana
The main advantage of trading using opposite Asian Alliance and AEON Thana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asian Alliance position performs unexpectedly, AEON Thana 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 AEON Thana will offset losses from the drop in AEON Thana's long position.| Asian Alliance vs. Kingsmen CMTI Public | Asian Alliance vs. Hydrotek Public | Asian Alliance vs. Karmarts Public | Asian Alliance vs. KC Metalsheet Public |
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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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