Correlation Between Advanced Info and Thai Union
Can any of the company-specific risk be diversified away by investing in both Advanced Info and Thai Union 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 Advanced Info and Thai Union into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advanced Info Service and Thai Union Group, you can compare the effects of market volatilities on Advanced Info and Thai Union 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 Advanced Info with a short position of Thai Union. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advanced Info and Thai Union.
Diversification Opportunities for Advanced Info and Thai Union
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Advanced and Thai is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Info Service and Thai Union Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Union Group and Advanced Info 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 Advanced Info Service are associated (or correlated) with Thai Union. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Union Group has no effect on the direction of Advanced Info i.e., Advanced Info and Thai Union go up and down completely randomly.
Pair Corralation between Advanced Info and Thai Union
Assuming the 90 days trading horizon Advanced Info Service is expected to generate 0.6 times more return on investment than Thai Union. However, Advanced Info Service is 1.66 times less risky than Thai Union. It trades about -0.01 of its potential returns per unit of risk. Thai Union Group is currently generating about -0.03 per unit of risk. If you would invest 28,400 in Advanced Info Service on October 23, 2024 and sell it today you would lose (100.00) from holding Advanced Info Service or give up 0.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advanced Info Service vs. Thai Union Group
Performance |
| Timeline |
| Advanced Info Service |
| Thai Union Group |
Advanced Info and Thai Union Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advanced Info and Thai Union
The main advantage of trading using opposite Advanced Info and Thai Union positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advanced Info position performs unexpectedly, Thai Union 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 Union will offset losses from the drop in Thai Union's long position.| Advanced Info vs. PTT Public | Advanced Info vs. CP ALL Public | Advanced Info vs. Kasikornbank Public | Advanced Info vs. Bangkok Bank Public |
| Thai Union vs. Charoen Pokphand Foods | Thai Union vs. CP ALL Public | Thai Union vs. Minor International Public | Thai Union vs. Advanced Info Service |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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