Correlation Between Asia Plus and Italian Thai
Can any of the company-specific risk be diversified away by investing in both Asia Plus and Italian Thai 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 Asia Plus and Italian Thai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asia Plus Group and Italian Thai Development Public, you can compare the effects of market volatilities on Asia Plus and Italian Thai 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 Asia Plus with a short position of Italian Thai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asia Plus and Italian Thai.
Diversification Opportunities for Asia Plus and Italian Thai
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Asia and Italian is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Asia Plus Group and Italian Thai Development Publi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Italian Thai Develop and Asia Plus 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 Asia Plus Group are associated (or correlated) with Italian Thai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Italian Thai Develop has no effect on the direction of Asia Plus i.e., Asia Plus and Italian Thai go up and down completely randomly.
Pair Corralation between Asia Plus and Italian Thai
Assuming the 90 days trading horizon Asia Plus Group is expected to generate 0.26 times more return on investment than Italian Thai. However, Asia Plus Group is 3.78 times less risky than Italian Thai. It trades about -0.21 of its potential returns per unit of risk. Italian Thai Development Public is currently generating about -0.33 per unit of risk. If you would invest 254.00 in Asia Plus Group on September 1, 2024 and sell it today you would lose (10.00) from holding Asia Plus Group or give up 3.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asia Plus Group vs. Italian Thai Development Publi
Performance |
| Timeline |
| Asia Plus Group |
| Italian Thai Develop |
Asia Plus and Italian Thai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asia Plus and Italian Thai
The main advantage of trading using opposite Asia Plus and Italian Thai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asia Plus position performs unexpectedly, Italian Thai 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 Italian Thai will offset losses from the drop in Italian Thai's long position.| Asia Plus vs. KGI Securities Public | Asia Plus vs. Bangkok Bank Public | Asia Plus vs. Land and Houses | Asia Plus vs. Italian Thai Development Public |
| Italian Thai vs. Land and Houses | Italian Thai vs. CH Karnchang Public | Italian Thai vs. Krung Thai Bank | Italian Thai vs. Bangkok Bank 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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