Correlation Between Internet Thailand and BW OFFSHORE
Can any of the company-specific risk be diversified away by investing in both Internet Thailand and BW OFFSHORE 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 BW OFFSHORE 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 BW OFFSHORE LTD, you can compare the effects of market volatilities on Internet Thailand and BW OFFSHORE 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 BW OFFSHORE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Internet Thailand and BW OFFSHORE.
Diversification Opportunities for Internet Thailand and BW OFFSHORE
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Internet and XY81 is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Internet Thailand PCL and BW OFFSHORE LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BW OFFSHORE LTD 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 BW OFFSHORE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BW OFFSHORE LTD has no effect on the direction of Internet Thailand i.e., Internet Thailand and BW OFFSHORE go up and down completely randomly.
Pair Corralation between Internet Thailand and BW OFFSHORE
Assuming the 90 days trading horizon Internet Thailand PCL is expected to generate 28.48 times more return on investment than BW OFFSHORE. However, Internet Thailand is 28.48 times more volatile than BW OFFSHORE LTD. It trades about 0.06 of its potential returns per unit of risk. BW OFFSHORE LTD is currently generating about 0.07 per unit of risk. If you would invest 11.00 in Internet Thailand PCL on September 3, 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 Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Internet Thailand PCL vs. BW OFFSHORE LTD
Performance |
| Timeline |
| Internet Thailand PCL |
| BW OFFSHORE LTD |
Internet Thailand and BW OFFSHORE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Internet Thailand and BW OFFSHORE
The main advantage of trading using opposite Internet Thailand and BW OFFSHORE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Internet Thailand position performs unexpectedly, BW OFFSHORE 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 BW OFFSHORE will offset losses from the drop in BW OFFSHORE's long position.| Internet Thailand vs. Marie Brizard Wine | Internet Thailand vs. Harmony Gold Mining | Internet Thailand vs. CapitaLand Investment Limited | Internet Thailand vs. MGIC INVESTMENT |
| BW OFFSHORE vs. Halliburton | BW OFFSHORE vs. Superior Plus Corp | BW OFFSHORE vs. NMI Holdings | BW OFFSHORE vs. Origin Agritech |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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