Correlation Between Ingress Industrial and Thai Wah

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Can any of the company-specific risk be diversified away by investing in both Ingress Industrial and Thai Wah 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 Ingress Industrial and Thai Wah into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ingress Industrial Public and Thai Wah Public, you can compare the effects of market volatilities on Ingress Industrial and Thai Wah 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 Ingress Industrial with a short position of Thai Wah. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingress Industrial and Thai Wah.

Diversification Opportunities for Ingress Industrial and Thai Wah

0.85
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Ingress and Thai is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Ingress Industrial Public and Thai Wah Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Wah Public and Ingress Industrial 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 Ingress Industrial Public are associated (or correlated) with Thai Wah. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Wah Public has no effect on the direction of Ingress Industrial i.e., Ingress Industrial and Thai Wah go up and down completely randomly.

Pair Corralation between Ingress Industrial and Thai Wah

Assuming the 90 days trading horizon Ingress Industrial is expected to generate 1.0 times less return on investment than Thai Wah. In addition to that, Ingress Industrial is 1.0 times more volatile than Thai Wah Public. It trades about 0.05 of its total potential returns per unit of risk. Thai Wah Public is currently generating about 0.05 per unit of volatility. If you would invest  390.00  in Thai Wah Public on September 14, 2024 and sell it today you would lose (94.00) from holding Thai Wah Public or give up 24.1% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Ingress Industrial Public  vs.  Thai Wah Public

 Performance 
       Timeline  
Ingress Industrial Public 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days Ingress Industrial Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's fundamental drivers remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.
Thai Wah Public 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Thai Wah Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's forward-looking signals remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Ingress Industrial and Thai Wah Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Ingress Industrial and Thai Wah

The main advantage of trading using opposite Ingress Industrial and Thai Wah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingress Industrial position performs unexpectedly, Thai Wah 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 Thai Wah will offset losses from the drop in Thai Wah's long position.
The idea behind Ingress Industrial Public and Thai Wah Public pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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