Correlation Between Hisense Home and Thai Beverage
Can any of the company-specific risk be diversified away by investing in both Hisense Home 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 Hisense Home and Thai Beverage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hisense Home Appliances and Thai Beverage Public, you can compare the effects of market volatilities on Hisense Home 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 Hisense Home with a short position of Thai Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hisense Home and Thai Beverage.
Diversification Opportunities for Hisense Home and Thai Beverage
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Hisense and Thai is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Hisense Home Appliances 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 Hisense Home 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 Hisense Home Appliances 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 Hisense Home i.e., Hisense Home and Thai Beverage go up and down completely randomly.
Pair Corralation between Hisense Home and Thai Beverage
Assuming the 90 days horizon Hisense Home Appliances is expected to generate 1.44 times more return on investment than Thai Beverage. However, Hisense Home is 1.44 times more volatile than Thai Beverage Public. It trades about 0.06 of its potential returns per unit of risk. Thai Beverage Public is currently generating about 0.04 per unit of risk. If you would invest 235.00 in Hisense Home Appliances on August 31, 2024 and sell it today you would earn a total of 29.00 from holding Hisense Home Appliances or generate 12.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.46% |
| Values | Daily Returns |
Hisense Home Appliances vs. Thai Beverage Public
Performance |
| Timeline |
| Hisense Home Appliances |
| Thai Beverage Public |
Hisense Home and Thai Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hisense Home and Thai Beverage
The main advantage of trading using opposite Hisense Home and Thai Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hisense Home 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.| Hisense Home vs. SERI INDUSTRIAL EO | Hisense Home vs. SOUTHWEST AIRLINES | Hisense Home vs. Gol Intelligent Airlines | Hisense Home vs. Scandinavian Tobacco Group |
| Thai Beverage vs. DOCDATA | Thai Beverage vs. Cass Information Systems | Thai Beverage vs. INFORMATION SVC GRP | Thai Beverage vs. PUBLIC STORAGE PRFO |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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