Correlation Between Finansa Public and Thai Industrial
Can any of the company-specific risk be diversified away by investing in both Finansa Public and Thai Industrial 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 Finansa Public and Thai Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Finansa Public and Thai Industrial, you can compare the effects of market volatilities on Finansa Public and Thai Industrial 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 Finansa Public with a short position of Thai Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Finansa Public and Thai Industrial.
Diversification Opportunities for Finansa Public and Thai Industrial
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Finansa and Thai is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Finansa Public and Thai Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Industrial and Finansa Public 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 Finansa Public are associated (or correlated) with Thai Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Industrial has no effect on the direction of Finansa Public i.e., Finansa Public and Thai Industrial go up and down completely randomly.
Pair Corralation between Finansa Public and Thai Industrial
Assuming the 90 days trading horizon Finansa Public is expected to generate 1.05 times less return on investment than Thai Industrial. But when comparing it to its historical volatility, Finansa Public is 1.0 times less risky than Thai Industrial. It trades about 0.05 of its potential returns per unit of risk. Thai Industrial is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 865.00 in Thai Industrial on September 14, 2024 and sell it today you would lose (110.00) from holding Thai Industrial or give up 12.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.62% |
| Values | Daily Returns |
Finansa Public vs. Thai Industrial
Performance |
| Timeline |
| Finansa Public |
| Thai Industrial |
Finansa Public and Thai Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Finansa Public and Thai Industrial
The main advantage of trading using opposite Finansa Public and Thai Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Finansa Public position performs unexpectedly, Thai Industrial 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 Industrial will offset losses from the drop in Thai Industrial's long position.| Finansa Public vs. Asia Plus Group | Finansa Public vs. KGI Securities Public | Finansa Public vs. Bank of Ayudhya | Finansa Public vs. CH Karnchang Public |
| Thai Industrial vs. Gulf Energy Development | Thai Industrial vs. CP ALL Public | Thai Industrial vs. BGrimm Power Public | Thai Industrial vs. Bangkok Expressway and |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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