Correlation Between Internet Thailand and Dassault Systmes
Can any of the company-specific risk be diversified away by investing in both Internet Thailand and Dassault Systmes 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 Dassault Systmes 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 Dassault Systmes SE, you can compare the effects of market volatilities on Internet Thailand and Dassault Systmes 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 Dassault Systmes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Internet Thailand and Dassault Systmes.
Diversification Opportunities for Internet Thailand and Dassault Systmes
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Internet and Dassault is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Internet Thailand PCL and Dassault Systmes SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dassault Systmes 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 Dassault Systmes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dassault Systmes has no effect on the direction of Internet Thailand i.e., Internet Thailand and Dassault Systmes go up and down completely randomly.
Pair Corralation between Internet Thailand and Dassault Systmes
Assuming the 90 days trading horizon Internet Thailand PCL is expected to generate 3.4 times more return on investment than Dassault Systmes. However, Internet Thailand is 3.4 times more volatile than Dassault Systmes SE. It trades about 0.13 of its potential returns per unit of risk. Dassault Systmes SE is currently generating about 0.28 per unit of risk. If you would invest 16.00 in Internet Thailand PCL on September 15, 2024 and sell it today you would earn a total of 2.00 from holding Internet Thailand PCL or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Internet Thailand PCL vs. Dassault Systmes SE
Performance |
| Timeline |
| Internet Thailand PCL |
| Dassault Systmes |
Internet Thailand and Dassault Systmes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Internet Thailand and Dassault Systmes
The main advantage of trading using opposite Internet Thailand and Dassault Systmes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Internet Thailand position performs unexpectedly, Dassault Systmes 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 Dassault Systmes will offset losses from the drop in Dassault Systmes' long position.| Internet Thailand vs. Apple Inc | Internet Thailand vs. Apple Inc | Internet Thailand vs. Apple Inc | Internet Thailand vs. Apple Inc |
| Dassault Systmes vs. RELIANCE STEEL AL | Dassault Systmes vs. COMPUTERSHARE | Dassault Systmes vs. INTERSHOP Communications Aktiengesellschaft | Dassault Systmes vs. Internet Thailand PCL |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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