Correlation Between Haad Thip and Home Product
Can any of the company-specific risk be diversified away by investing in both Haad Thip and Home Product 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 Haad Thip and Home Product into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Haad Thip Public and Home Product Center, you can compare the effects of market volatilities on Haad Thip and Home Product 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 Haad Thip with a short position of Home Product. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haad Thip and Home Product.
Diversification Opportunities for Haad Thip and Home Product
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Haad and Home is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Haad Thip Public and Home Product Center in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Home Product Center and Haad Thip 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 Haad Thip Public are associated (or correlated) with Home Product. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Home Product Center has no effect on the direction of Haad Thip i.e., Haad Thip and Home Product go up and down completely randomly.
Pair Corralation between Haad Thip and Home Product
Assuming the 90 days trading horizon Haad Thip Public is expected to under-perform the Home Product. But the stock apears to be less risky and, when comparing its historical volatility, Haad Thip Public is 1.08 times less risky than Home Product. The stock trades about -0.06 of its potential returns per unit of risk. The Home Product Center is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 945.00 in Home Product Center on September 13, 2024 and sell it today you would earn a total of 30.00 from holding Home Product Center or generate 3.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haad Thip Public vs. Home Product Center
Performance |
| Timeline |
| Haad Thip Public |
| Home Product Center |
Haad Thip and Home Product Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haad Thip and Home Product
The main advantage of trading using opposite Haad Thip and Home Product positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haad Thip position performs unexpectedly, Home Product 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 Home Product will offset losses from the drop in Home Product's long position.| Haad Thip vs. GFPT Public | Haad Thip vs. Dynasty Ceramic Public | Haad Thip vs. The Erawan Group | Haad Thip vs. Jay Mart Public |
| Home Product vs. Hwa Fong Rubber | Home Product vs. AAPICO Hitech Public | Home Product vs. Haad Thip Public | Home Product vs. Italian Thai Development 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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