Correlation Between CHINA EDUCATION and Thai Beverage
Can any of the company-specific risk be diversified away by investing in both CHINA EDUCATION 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 CHINA EDUCATION and Thai Beverage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CHINA EDUCATION GROUP and Thai Beverage Public, you can compare the effects of market volatilities on CHINA EDUCATION 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 CHINA EDUCATION with a short position of Thai Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHINA EDUCATION and Thai Beverage.
Diversification Opportunities for CHINA EDUCATION and Thai Beverage
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CHINA and Thai is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding CHINA EDUCATION GROUP and Thai Beverage Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Beverage Public and CHINA EDUCATION 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 CHINA EDUCATION GROUP 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 Public has no effect on the direction of CHINA EDUCATION i.e., CHINA EDUCATION and Thai Beverage go up and down completely randomly.
Pair Corralation between CHINA EDUCATION and Thai Beverage
Assuming the 90 days horizon CHINA EDUCATION GROUP is expected to under-perform the Thai Beverage. In addition to that, CHINA EDUCATION is 1.03 times more volatile than Thai Beverage Public. It trades about -0.17 of its total potential returns per unit of risk. Thai Beverage Public is currently generating about 0.04 per unit of volatility. If you would invest 35.00 in Thai Beverage Public on October 26, 2024 and sell it today you would earn a total of 2.00 from holding Thai Beverage Public or generate 5.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CHINA EDUCATION GROUP vs. Thai Beverage Public
Performance |
| Timeline |
| CHINA EDUCATION GROUP |
| Thai Beverage Public |
CHINA EDUCATION and Thai Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CHINA EDUCATION and Thai Beverage
The main advantage of trading using opposite CHINA EDUCATION and Thai Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHINA EDUCATION 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.| CHINA EDUCATION vs. Apple Inc | CHINA EDUCATION vs. Apple Inc | CHINA EDUCATION vs. Apple Inc | CHINA EDUCATION vs. Apple Inc |
| Thai Beverage vs. Diageo plc | Thai Beverage vs. Pernod Ricard SA | Thai Beverage vs. Constellation Brands | Thai Beverage vs. Brown Forman |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |