Correlation Between Italian Thai and Sabina Public
Can any of the company-specific risk be diversified away by investing in both Italian Thai and Sabina Public 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 Sabina Public 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 Sabina Public, you can compare the effects of market volatilities on Italian Thai and Sabina Public 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 Sabina Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Italian Thai and Sabina Public.
Diversification Opportunities for Italian Thai and Sabina Public
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Italian and Sabina is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Italian Thai Development Publi and Sabina Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sabina Public 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 Sabina Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sabina Public has no effect on the direction of Italian Thai i.e., Italian Thai and Sabina Public go up and down completely randomly.
Pair Corralation between Italian Thai and Sabina Public
Assuming the 90 days trading horizon Italian Thai is expected to generate 1.08 times less return on investment than Sabina Public. In addition to that, Italian Thai is 1.0 times more volatile than Sabina Public. It trades about 0.05 of its total potential returns per unit of risk. Sabina Public is currently generating about 0.05 per unit of volatility. If you would invest 2,254 in Sabina Public on September 12, 2024 and sell it today you would lose (144.00) from holding Sabina Public or give up 6.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Italian Thai Development Publi vs. Sabina Public
Performance |
| Timeline |
| Italian Thai Develop |
| Sabina Public |
Italian Thai and Sabina Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Italian Thai and Sabina Public
The main advantage of trading using opposite Italian Thai and Sabina Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Italian Thai position performs unexpectedly, Sabina Public 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 Sabina Public will offset losses from the drop in Sabina Public'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 |
| Sabina Public vs. Hwa Fong Rubber | Sabina Public vs. AAPICO Hitech Public | Sabina Public vs. Haad Thip Public | Sabina Public vs. Italian Thai Development 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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