Correlation Between Cass Information and Internet Thailand
Can any of the company-specific risk be diversified away by investing in both Cass Information and Internet Thailand 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 Cass Information and Internet Thailand into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cass Information Systems and Internet Thailand PCL, you can compare the effects of market volatilities on Cass Information and Internet Thailand 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 Cass Information with a short position of Internet Thailand. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cass Information and Internet Thailand.
Diversification Opportunities for Cass Information and Internet Thailand
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cass and Internet is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Cass Information Systems and Internet Thailand PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Internet Thailand PCL and Cass Information 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 Cass Information Systems are associated (or correlated) with Internet Thailand. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Internet Thailand PCL has no effect on the direction of Cass Information i.e., Cass Information and Internet Thailand go up and down completely randomly.
Pair Corralation between Cass Information and Internet Thailand
Assuming the 90 days horizon Cass Information is expected to generate 62.03 times less return on investment than Internet Thailand. But when comparing it to its historical volatility, Cass Information Systems is 31.6 times less risky than Internet Thailand. It trades about 0.03 of its potential returns per unit of risk. Internet Thailand PCL is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 9.45 in Internet Thailand PCL on September 4, 2024 and sell it today you would earn a total of 9.55 from holding Internet Thailand PCL or generate 101.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cass Information Systems vs. Internet Thailand PCL
Performance |
| Timeline |
| Cass Information Systems |
| Internet Thailand PCL |
Cass Information and Internet Thailand Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cass Information and Internet Thailand
The main advantage of trading using opposite Cass Information and Internet Thailand positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cass Information position performs unexpectedly, Internet Thailand 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 Internet Thailand will offset losses from the drop in Internet Thailand's long position.| Cass Information vs. Elis SA | Cass Information vs. Superior Plus Corp | Cass Information vs. NMI Holdings | Cass Information vs. Origin Agritech |
| Internet Thailand vs. Scandinavian Tobacco Group | Internet Thailand vs. URBAN OUTFITTERS | Internet Thailand vs. Cass Information Systems | Internet Thailand vs. Datadog |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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