Correlation Between Gulf Energy and Cho Thavee
Can any of the company-specific risk be diversified away by investing in both Gulf Energy and Cho Thavee 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 Gulf Energy and Cho Thavee into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gulf Energy Development and Cho Thavee Public, you can compare the effects of market volatilities on Gulf Energy and Cho Thavee 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 Gulf Energy with a short position of Cho Thavee. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gulf Energy and Cho Thavee.
Diversification Opportunities for Gulf Energy and Cho Thavee
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Gulf and Cho is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Gulf Energy Development and Cho Thavee Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cho Thavee Public and Gulf Energy 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 Gulf Energy Development are associated (or correlated) with Cho Thavee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cho Thavee Public has no effect on the direction of Gulf Energy i.e., Gulf Energy and Cho Thavee go up and down completely randomly.
Pair Corralation between Gulf Energy and Cho Thavee
Assuming the 90 days trading horizon Gulf Energy Development is expected to generate 0.15 times more return on investment than Cho Thavee. However, Gulf Energy Development is 6.81 times less risky than Cho Thavee. It trades about -0.09 of its potential returns per unit of risk. Cho Thavee Public is currently generating about -0.03 per unit of risk. If you would invest 6,525 in Gulf Energy Development on August 29, 2024 and sell it today you would lose (250.00) from holding Gulf Energy Development or give up 3.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Gulf Energy Development vs. Cho Thavee Public
Performance |
| Timeline |
| Gulf Energy Development |
| Cho Thavee Public |
Gulf Energy and Cho Thavee Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gulf Energy and Cho Thavee
The main advantage of trading using opposite Gulf Energy and Cho Thavee positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gulf Energy position performs unexpectedly, Cho Thavee 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 Cho Thavee will offset losses from the drop in Cho Thavee's long position.| Gulf Energy vs. WHA Public | Gulf Energy vs. Global Power Synergy | Gulf Energy vs. TPI Polene Power | Gulf Energy vs. Bangkok Expressway and |
| Cho Thavee vs. Chewathai Public | Cho Thavee vs. Filter Vision Public | Cho Thavee vs. G Capital Public | Cho Thavee vs. Demco 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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