Correlation Between Italian Thai and Grand Prix
Can any of the company-specific risk be diversified away by investing in both Italian Thai and Grand Prix 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 Italian Thai and Grand Prix into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Italian Thai Development Public and Grand Prix International, you can compare the effects of market volatilities on Italian Thai and Grand Prix 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 Italian Thai with a short position of Grand Prix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Italian Thai and Grand Prix.
Diversification Opportunities for Italian Thai and Grand Prix
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Italian and Grand is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Italian Thai Development Publi and Grand Prix International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grand Prix International and Italian Thai 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 Italian Thai Development Public are associated (or correlated) with Grand Prix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grand Prix International has no effect on the direction of Italian Thai i.e., Italian Thai and Grand Prix go up and down completely randomly.
Pair Corralation between Italian Thai and Grand Prix
Assuming the 90 days trading horizon Italian Thai Development Public is expected to under-perform the Grand Prix. In addition to that, Italian Thai is 2.76 times more volatile than Grand Prix International. It trades about -0.28 of its total potential returns per unit of risk. Grand Prix International is currently generating about 0.0 per unit of volatility. If you would invest 163.00 in Grand Prix International on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Grand Prix International or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Italian Thai Development Publi vs. Grand Prix International
Performance |
| Timeline |
| Italian Thai Develop |
| Grand Prix International |
Italian Thai and Grand Prix Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Italian Thai and Grand Prix
The main advantage of trading using opposite Italian Thai and Grand Prix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Italian Thai position performs unexpectedly, Grand Prix 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 Grand Prix will offset losses from the drop in Grand Prix's long position.| Italian Thai vs. Land and Houses | Italian Thai vs. CH Karnchang Public | Italian Thai vs. Krung Thai Bank | Italian Thai vs. Bangkok Bank Public |
| Grand Prix vs. Interlink Communication Public | Grand Prix vs. Aqua Public | Grand Prix vs. BEC World Public | Grand Prix vs. Grande Asset Hotels |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |