Correlation Between Applied Materials and THAI BEVERAGE
Can any of the company-specific risk be diversified away by investing in both Applied Materials and THAI BEVERAGE 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 Applied Materials and THAI BEVERAGE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Applied Materials and THAI BEVERAGE, you can compare the effects of market volatilities on Applied Materials and THAI BEVERAGE 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 Applied Materials with a short position of THAI BEVERAGE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Applied Materials and THAI BEVERAGE.
Diversification Opportunities for Applied Materials and THAI BEVERAGE
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Applied and THAI is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Applied Materials and THAI BEVERAGE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on THAI BEVERAGE and Applied Materials 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 Applied Materials are associated (or correlated) with THAI BEVERAGE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of THAI BEVERAGE has no effect on the direction of Applied Materials i.e., Applied Materials and THAI BEVERAGE go up and down completely randomly.
Pair Corralation between Applied Materials and THAI BEVERAGE
Assuming the 90 days horizon Applied Materials is expected to generate 30.99 times less return on investment than THAI BEVERAGE. In addition to that, Applied Materials is 1.17 times more volatile than THAI BEVERAGE. It trades about 0.01 of its total potential returns per unit of risk. THAI BEVERAGE is currently generating about 0.27 per unit of volatility. If you would invest 34.00 in THAI BEVERAGE on September 2, 2024 and sell it today you would earn a total of 5.00 from holding THAI BEVERAGE or generate 14.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Applied Materials vs. THAI BEVERAGE
Performance |
| Timeline |
| Applied Materials |
| THAI BEVERAGE |
Applied Materials and THAI BEVERAGE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Applied Materials and THAI BEVERAGE
The main advantage of trading using opposite Applied Materials and THAI BEVERAGE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Applied Materials position performs unexpectedly, THAI BEVERAGE 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 BEVERAGE will offset losses from the drop in THAI BEVERAGE's long position.| Applied Materials vs. PLAYTECH | Applied Materials vs. China BlueChemical | Applied Materials vs. ANTA SPORTS PRODUCT | Applied Materials vs. Sekisui Chemical Co |
| THAI BEVERAGE vs. SIVERS SEMICONDUCTORS AB | THAI BEVERAGE vs. Darden Restaurants | THAI BEVERAGE vs. Reliance Steel Aluminum | THAI BEVERAGE vs. Q2M Managementberatung AG |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |