Correlation Between Internet Thailand and Ross Stores
Can any of the company-specific risk be diversified away by investing in both Internet Thailand and Ross Stores 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 Ross Stores 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 Ross Stores, you can compare the effects of market volatilities on Internet Thailand and Ross Stores 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 Ross Stores. Check out your portfolio center. Please also check ongoing floating volatility patterns of Internet Thailand and Ross Stores.
Diversification Opportunities for Internet Thailand and Ross Stores
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Internet and Ross is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Internet Thailand PCL and Ross Stores in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ross Stores 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 Ross Stores. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ross Stores has no effect on the direction of Internet Thailand i.e., Internet Thailand and Ross Stores go up and down completely randomly.
Pair Corralation between Internet Thailand and Ross Stores
Assuming the 90 days trading horizon Internet Thailand PCL is expected to generate 2.71 times more return on investment than Ross Stores. However, Internet Thailand is 2.71 times more volatile than Ross Stores. It trades about 0.27 of its potential returns per unit of risk. Ross Stores is currently generating about 0.22 per unit of risk. If you would invest 11.00 in Internet Thailand PCL on September 2, 2024 and sell it today you would earn a total of 5.00 from holding Internet Thailand PCL or generate 45.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Internet Thailand PCL vs. Ross Stores
Performance |
| Timeline |
| Internet Thailand PCL |
| Ross Stores |
Internet Thailand and Ross Stores Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Internet Thailand and Ross Stores
The main advantage of trading using opposite Internet Thailand and Ross Stores positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Internet Thailand position performs unexpectedly, Ross Stores 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 Ross Stores will offset losses from the drop in Ross Stores' long position.| Internet Thailand vs. Lion Biotechnologies | Internet Thailand vs. Global Ship Lease | Internet Thailand vs. PKSHA TECHNOLOGY INC | Internet Thailand vs. Air Lease |
| Ross Stores vs. Jacquet Metal Service | Ross Stores vs. POWER METALS | Ross Stores vs. Federal Agricultural Mortgage | Ross Stores vs. FIREWEED METALS P |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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