Correlation Between AEON Thana and Thai Energy
Can any of the company-specific risk be diversified away by investing in both AEON Thana and Thai Energy 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 AEON Thana and Thai Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AEON Thana Sinsap and Thai Energy Storage, you can compare the effects of market volatilities on AEON Thana and Thai Energy 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 AEON Thana with a short position of Thai Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of AEON Thana and Thai Energy.
Diversification Opportunities for AEON Thana and Thai Energy
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between AEON and Thai is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding AEON Thana Sinsap and Thai Energy Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Energy Storage and AEON Thana 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 AEON Thana Sinsap are associated (or correlated) with Thai Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Energy Storage has no effect on the direction of AEON Thana i.e., AEON Thana and Thai Energy go up and down completely randomly.
Pair Corralation between AEON Thana and Thai Energy
Assuming the 90 days trading horizon AEON Thana Sinsap is expected to under-perform the Thai Energy. But the stock apears to be less risky and, when comparing its historical volatility, AEON Thana Sinsap is 26.21 times less risky than Thai Energy. The stock trades about -0.04 of its potential returns per unit of risk. The Thai Energy Storage is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 6,240 in Thai Energy Storage on August 31, 2024 and sell it today you would lose (865.00) from holding Thai Energy Storage or give up 13.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.78% |
| Values | Daily Returns |
AEON Thana Sinsap vs. Thai Energy Storage
Performance |
| Timeline |
| AEON Thana Sinsap |
| Thai Energy Storage |
AEON Thana and Thai Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AEON Thana and Thai Energy
The main advantage of trading using opposite AEON Thana and Thai Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AEON Thana position performs unexpectedly, Thai Energy 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 Energy will offset losses from the drop in Thai Energy's long position.The idea behind AEON Thana Sinsap and Thai Energy Storage pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Thai Energy vs. AJ Advance Technology | Thai Energy vs. Cpt Drives Power | Thai Energy vs. Asia Metal Public | Thai Energy 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |