Correlation Between Telecoms Informatics and Pha Lai
Can any of the company-specific risk be diversified away by investing in both Telecoms Informatics and Pha Lai 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 Telecoms Informatics and Pha Lai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Telecoms Informatics JSC and Pha Lai Thermal, you can compare the effects of market volatilities on Telecoms Informatics and Pha Lai 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 Telecoms Informatics with a short position of Pha Lai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telecoms Informatics and Pha Lai.
Diversification Opportunities for Telecoms Informatics and Pha Lai
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Telecoms and Pha is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Telecoms Informatics JSC and Pha Lai Thermal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pha Lai Thermal and Telecoms Informatics 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 Telecoms Informatics JSC are associated (or correlated) with Pha Lai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pha Lai Thermal has no effect on the direction of Telecoms Informatics i.e., Telecoms Informatics and Pha Lai go up and down completely randomly.
Pair Corralation between Telecoms Informatics and Pha Lai
Assuming the 90 days trading horizon Telecoms Informatics JSC is expected to generate 2.2 times more return on investment than Pha Lai. However, Telecoms Informatics is 2.2 times more volatile than Pha Lai Thermal. It trades about 0.08 of its potential returns per unit of risk. Pha Lai Thermal is currently generating about -0.36 per unit of risk. If you would invest 1,245,000 in Telecoms Informatics JSC on September 1, 2024 and sell it today you would earn a total of 55,000 from holding Telecoms Informatics JSC or generate 4.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Telecoms Informatics JSC vs. Pha Lai Thermal
Performance |
| Timeline |
| Telecoms Informatics JSC |
| Pha Lai Thermal |
Telecoms Informatics and Pha Lai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telecoms Informatics and Pha Lai
The main advantage of trading using opposite Telecoms Informatics and Pha Lai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telecoms Informatics position performs unexpectedly, Pha Lai 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 Pha Lai will offset losses from the drop in Pha Lai's long position.| Telecoms Informatics vs. FIT INVEST JSC | Telecoms Informatics vs. Damsan JSC | Telecoms Informatics vs. An Phat Plastic | Telecoms Informatics vs. Alphanam ME |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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