Correlation Between Internet Thailand and Gladstone Investment
Can any of the company-specific risk be diversified away by investing in both Internet Thailand and Gladstone Investment 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 Internet Thailand and Gladstone Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Internet Thailand PCL and Gladstone Investment, you can compare the effects of market volatilities on Internet Thailand and Gladstone Investment 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 Internet Thailand with a short position of Gladstone Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Internet Thailand and Gladstone Investment.
Diversification Opportunities for Internet Thailand and Gladstone Investment
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Internet and Gladstone is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Internet Thailand PCL and Gladstone Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gladstone Investment and Internet Thailand 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 Internet Thailand PCL are associated (or correlated) with Gladstone Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gladstone Investment has no effect on the direction of Internet Thailand i.e., Internet Thailand and Gladstone Investment go up and down completely randomly.
Pair Corralation between Internet Thailand and Gladstone Investment
Assuming the 90 days trading horizon Internet Thailand PCL is expected to generate 3.12 times more return on investment than Gladstone Investment. However, Internet Thailand is 3.12 times more volatile than Gladstone Investment. It trades about 0.42 of its potential returns per unit of risk. Gladstone Investment is currently generating about -0.01 per unit of risk. If you would invest 11.00 in Internet Thailand PCL on August 25, 2024 and sell it today you would earn a total of 8.00 from holding Internet Thailand PCL or generate 72.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Internet Thailand PCL vs. Gladstone Investment
Performance |
| Timeline |
| Internet Thailand PCL |
| Gladstone Investment |
Internet Thailand and Gladstone Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Internet Thailand and Gladstone Investment
The main advantage of trading using opposite Internet Thailand and Gladstone Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Internet Thailand position performs unexpectedly, Gladstone Investment 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 Gladstone Investment will offset losses from the drop in Gladstone Investment's long position.| Internet Thailand vs. Gladstone Investment | Internet Thailand vs. ECHO INVESTMENT ZY | Internet Thailand vs. Vastned Retail NV | Internet Thailand vs. AOYAMA TRADING |
| Gladstone Investment vs. Lyxor 1 | Gladstone Investment vs. Xtrackers LevDAX | Gladstone Investment vs. Xtrackers ShortDAX |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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