Correlation Between CPR Gomu and Thanachart Capital
Can any of the company-specific risk be diversified away by investing in both CPR Gomu and Thanachart Capital 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 CPR Gomu and Thanachart Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CPR Gomu Industrial and Thanachart Capital Public, you can compare the effects of market volatilities on CPR Gomu and Thanachart Capital 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 CPR Gomu with a short position of Thanachart Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of CPR Gomu and Thanachart Capital.
Diversification Opportunities for CPR Gomu and Thanachart Capital
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CPR and Thanachart is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding CPR Gomu Industrial and Thanachart Capital Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thanachart Capital Public and CPR Gomu 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 CPR Gomu Industrial are associated (or correlated) with Thanachart Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thanachart Capital Public has no effect on the direction of CPR Gomu i.e., CPR Gomu and Thanachart Capital go up and down completely randomly.
Pair Corralation between CPR Gomu and Thanachart Capital
Assuming the 90 days trading horizon CPR Gomu Industrial is expected to generate 3.9 times more return on investment than Thanachart Capital. However, CPR Gomu is 3.9 times more volatile than Thanachart Capital Public. It trades about 0.21 of its potential returns per unit of risk. Thanachart Capital Public is currently generating about -0.1 per unit of risk. If you would invest 292.00 in CPR Gomu Industrial on September 12, 2024 and sell it today you would earn a total of 54.00 from holding CPR Gomu Industrial or generate 18.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
CPR Gomu Industrial vs. Thanachart Capital Public
Performance |
| Timeline |
| CPR Gomu Industrial |
| Thanachart Capital Public |
CPR Gomu and Thanachart Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CPR Gomu and Thanachart Capital
The main advantage of trading using opposite CPR Gomu and Thanachart Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CPR Gomu position performs unexpectedly, Thanachart Capital 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 Thanachart Capital will offset losses from the drop in Thanachart Capital's long position.| CPR Gomu vs. Thoresen Thai Agencies | CPR Gomu vs. Sri Trang Agro Industry | CPR Gomu vs. TPI Polene Public | CPR Gomu vs. Ratchthani Leasing Public |
| Thanachart Capital vs. TISCO Financial Group | Thanachart Capital vs. Kiatnakin Phatra Bank | Thanachart Capital vs. SCB X Public | Thanachart Capital vs. Kasikornbank 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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