Correlation Between Airports and Thanapiriya Public
Can any of the company-specific risk be diversified away by investing in both Airports and Thanapiriya 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 Airports and Thanapiriya Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Airports of Thailand and Thanapiriya Public, you can compare the effects of market volatilities on Airports and Thanapiriya 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 Airports with a short position of Thanapiriya Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airports and Thanapiriya Public.
Diversification Opportunities for Airports and Thanapiriya Public
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Airports and Thanapiriya is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Airports of Thailand and Thanapiriya Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thanapiriya Public and Airports 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 Airports of Thailand are associated (or correlated) with Thanapiriya Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thanapiriya Public has no effect on the direction of Airports i.e., Airports and Thanapiriya Public go up and down completely randomly.
Pair Corralation between Airports and Thanapiriya Public
Assuming the 90 days trading horizon Airports of Thailand is expected to under-perform the Thanapiriya Public. In addition to that, Airports is 1.67 times more volatile than Thanapiriya Public. It trades about -0.19 of its total potential returns per unit of risk. Thanapiriya Public is currently generating about 0.07 per unit of volatility. If you would invest 350.00 in Thanapiriya Public on September 1, 2024 and sell it today you would earn a total of 10.00 from holding Thanapiriya Public or generate 2.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Airports of Thailand vs. Thanapiriya Public
Performance |
| Timeline |
| Airports of Thailand |
| Thanapiriya Public |
Airports and Thanapiriya Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Airports and Thanapiriya Public
The main advantage of trading using opposite Airports and Thanapiriya Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airports position performs unexpectedly, Thanapiriya 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 Thanapiriya Public will offset losses from the drop in Thanapiriya Public's long position.| Airports vs. CP ALL Public | Airports vs. PTT Public | Airports vs. Bangkok Dusit Medical | Airports vs. The Siam Cement |
| Thanapiriya Public vs. Airports of Thailand | Thanapiriya Public vs. CP ALL Public | Thanapiriya Public vs. Charoen Pokphand Foods | Thanapiriya Public vs. Bangkok Dusit Medical |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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