Correlation Between AAPICO Hitech and Thantawan Industry
Can any of the company-specific risk be diversified away by investing in both AAPICO Hitech and Thantawan Industry 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 AAPICO Hitech and Thantawan Industry into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AAPICO Hitech Public and Thantawan Industry Public, you can compare the effects of market volatilities on AAPICO Hitech and Thantawan Industry 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 AAPICO Hitech with a short position of Thantawan Industry. Check out your portfolio center. Please also check ongoing floating volatility patterns of AAPICO Hitech and Thantawan Industry.
Diversification Opportunities for AAPICO Hitech and Thantawan Industry
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between AAPICO and Thantawan is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding AAPICO Hitech Public and Thantawan Industry Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thantawan Industry Public and AAPICO Hitech 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 AAPICO Hitech Public are associated (or correlated) with Thantawan Industry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thantawan Industry Public has no effect on the direction of AAPICO Hitech i.e., AAPICO Hitech and Thantawan Industry go up and down completely randomly.
Pair Corralation between AAPICO Hitech and Thantawan Industry
Assuming the 90 days horizon AAPICO Hitech Public is expected to under-perform the Thantawan Industry. In addition to that, AAPICO Hitech is 2.14 times more volatile than Thantawan Industry Public. It trades about -0.05 of its total potential returns per unit of risk. Thantawan Industry Public is currently generating about 0.03 per unit of volatility. If you would invest 2,761 in Thantawan Industry Public on September 3, 2024 and sell it today you would earn a total of 114.00 from holding Thantawan Industry Public or generate 4.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AAPICO Hitech Public vs. Thantawan Industry Public
Performance |
| Timeline |
| AAPICO Hitech Public |
| Thantawan Industry Public |
AAPICO Hitech and Thantawan Industry Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AAPICO Hitech and Thantawan Industry
The main advantage of trading using opposite AAPICO Hitech and Thantawan Industry positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AAPICO Hitech position performs unexpectedly, Thantawan Industry 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 Thantawan Industry will offset losses from the drop in Thantawan Industry's long position.| AAPICO Hitech vs. Central Pattana Public | AAPICO Hitech vs. CP ALL Public | AAPICO Hitech vs. Bangkok Dusit Medical | AAPICO Hitech vs. Airports of Thailand |
| Thantawan Industry vs. Thai Metal Drum | Thantawan Industry vs. Haad Thip Public | Thantawan Industry vs. Sahamitr Pressure Container | Thantawan Industry vs. Ratchthani Leasing Public |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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