Correlation Between Internet Thailand and INTER CARS
Can any of the company-specific risk be diversified away by investing in both Internet Thailand and INTER CARS 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 INTER CARS 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 INTER CARS SA, you can compare the effects of market volatilities on Internet Thailand and INTER CARS 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 INTER CARS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Internet Thailand and INTER CARS.
Diversification Opportunities for Internet Thailand and INTER CARS
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Internet and INTER is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Internet Thailand PCL and INTER CARS SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTER CARS SA 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 INTER CARS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INTER CARS SA has no effect on the direction of Internet Thailand i.e., Internet Thailand and INTER CARS go up and down completely randomly.
Pair Corralation between Internet Thailand and INTER CARS
Assuming the 90 days trading horizon Internet Thailand PCL is expected to generate 22.88 times more return on investment than INTER CARS. However, Internet Thailand is 22.88 times more volatile than INTER CARS SA. It trades about 0.05 of its potential returns per unit of risk. INTER CARS SA is currently generating about 0.01 per unit of risk. If you would invest 12.00 in Internet Thailand PCL on August 29, 2024 and sell it today you would earn a total of 6.00 from holding Internet Thailand PCL or generate 50.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Internet Thailand PCL vs. INTER CARS SA
Performance |
| Timeline |
| Internet Thailand PCL |
| INTER CARS SA |
Internet Thailand and INTER CARS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Internet Thailand and INTER CARS
The main advantage of trading using opposite Internet Thailand and INTER CARS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Internet Thailand position performs unexpectedly, INTER CARS 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 INTER CARS will offset losses from the drop in INTER CARS's long position.| Internet Thailand vs. Apple Inc | Internet Thailand vs. Apple Inc | Internet Thailand vs. Apple Inc | Internet Thailand vs. Apple Inc |
| INTER CARS vs. Superior Plus Corp | INTER CARS vs. NMI Holdings | INTER CARS vs. Origin Agritech | INTER CARS vs. SIVERS SEMICONDUCTORS AB |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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