Correlation Between Inoue Rubber and Haad Thip
Can any of the company-specific risk be diversified away by investing in both Inoue Rubber and Haad Thip 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 Inoue Rubber and Haad Thip into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inoue Rubber Public and Haad Thip Public, you can compare the effects of market volatilities on Inoue Rubber and Haad Thip 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 Inoue Rubber with a short position of Haad Thip. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inoue Rubber and Haad Thip.
Diversification Opportunities for Inoue Rubber and Haad Thip
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Inoue and Haad is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Inoue Rubber Public and Haad Thip Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haad Thip Public and Inoue Rubber 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 Inoue Rubber Public are associated (or correlated) with Haad Thip. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haad Thip Public has no effect on the direction of Inoue Rubber i.e., Inoue Rubber and Haad Thip go up and down completely randomly.
Pair Corralation between Inoue Rubber and Haad Thip
Assuming the 90 days trading horizon Inoue Rubber Public is expected to generate 48.11 times more return on investment than Haad Thip. However, Inoue Rubber is 48.11 times more volatile than Haad Thip Public. It trades about 0.06 of its potential returns per unit of risk. Haad Thip Public is currently generating about 0.04 per unit of risk. If you would invest 1,300 in Inoue Rubber Public on September 2, 2024 and sell it today you would earn a total of 110.00 from holding Inoue Rubber Public or generate 8.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inoue Rubber Public vs. Haad Thip Public
Performance |
| Timeline |
| Inoue Rubber Public |
| Haad Thip Public |
Inoue Rubber and Haad Thip Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inoue Rubber and Haad Thip
The main advantage of trading using opposite Inoue Rubber and Haad Thip positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inoue Rubber position performs unexpectedly, Haad Thip 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 Haad Thip will offset losses from the drop in Haad Thip's long position.| Inoue Rubber vs. TRC Construction Public | Inoue Rubber vs. Bangkok Expressway and | Inoue Rubber vs. Lohakit Metal Public | Inoue Rubber vs. Gunkul Engineering Public |
| Haad Thip vs. MK Restaurant Group | Haad Thip vs. TRC Construction Public | Haad Thip vs. Bangkok Expressway and | Haad Thip vs. Lohakit Metal Public |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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