Correlation Between Asian Alliance and Thaicom Public
Can any of the company-specific risk be diversified away by investing in both Asian Alliance and Thaicom Public 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 Thaicom Public 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 Thaicom Public, you can compare the effects of market volatilities on Asian Alliance and Thaicom Public 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 Thaicom Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asian Alliance and Thaicom Public.
Diversification Opportunities for Asian Alliance and Thaicom Public
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Asian and Thaicom is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Asian Alliance International and Thaicom Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thaicom Public 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 Thaicom Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thaicom Public has no effect on the direction of Asian Alliance i.e., Asian Alliance and Thaicom Public go up and down completely randomly.
Pair Corralation between Asian Alliance and Thaicom Public
Assuming the 90 days trading horizon Asian Alliance is expected to generate 56.22 times less return on investment than Thaicom Public. But when comparing it to its historical volatility, Asian Alliance International is 15.86 times less risky than Thaicom Public. It trades about 0.01 of its potential returns per unit of risk. Thaicom Public is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,271 in Thaicom Public on September 12, 2024 and sell it today you would earn a total of 169.00 from holding Thaicom Public or generate 13.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asian Alliance International vs. Thaicom Public
Performance |
| Timeline |
| Asian Alliance Inter |
| Thaicom Public |
Asian Alliance and Thaicom Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asian Alliance and Thaicom Public
The main advantage of trading using opposite Asian Alliance and Thaicom Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asian Alliance position performs unexpectedly, Thaicom Public 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 Thaicom Public will offset losses from the drop in Thaicom Public's long position.| Asian Alliance vs. i Tail Corp PCL | Asian Alliance vs. North East Rubbers | Asian Alliance vs. Thai Life Insurance | Asian Alliance vs. Exotic Food Public |
| Thaicom Public vs. Synnex Public | Thaicom Public vs. SVI Public | Thaicom Public vs. Interlink Communication Public | Thaicom Public vs. The Erawan Group |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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