Correlation Between Lohakit Metal and Thai Coating
Can any of the company-specific risk be diversified away by investing in both Lohakit Metal and Thai Coating 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 Lohakit Metal and Thai Coating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lohakit Metal Public and Thai Coating Industrial, you can compare the effects of market volatilities on Lohakit Metal and Thai Coating 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 Lohakit Metal with a short position of Thai Coating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lohakit Metal and Thai Coating.
Diversification Opportunities for Lohakit Metal and Thai Coating
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Lohakit and Thai is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Lohakit Metal Public and Thai Coating Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Coating Industrial and Lohakit Metal 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 Lohakit Metal Public are associated (or correlated) with Thai Coating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Coating Industrial has no effect on the direction of Lohakit Metal i.e., Lohakit Metal and Thai Coating go up and down completely randomly.
Pair Corralation between Lohakit Metal and Thai Coating
Assuming the 90 days trading horizon Lohakit Metal is expected to generate 257.5 times less return on investment than Thai Coating. But when comparing it to its historical volatility, Lohakit Metal Public is 11.6 times less risky than Thai Coating. It trades about 0.0 of its potential returns per unit of risk. Thai Coating Industrial is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2,600 in Thai Coating Industrial on August 31, 2024 and sell it today you would earn a total of 150.00 from holding Thai Coating Industrial or generate 5.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lohakit Metal Public vs. Thai Coating Industrial
Performance |
| Timeline |
| Lohakit Metal Public |
| Thai Coating Industrial |
Lohakit Metal and Thai Coating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lohakit Metal and Thai Coating
The main advantage of trading using opposite Lohakit Metal and Thai Coating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lohakit Metal position performs unexpectedly, Thai Coating 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 Coating will offset losses from the drop in Thai Coating's long position.| Lohakit Metal vs. Gulf Energy Development | Lohakit Metal vs. Energy Absolute Public | Lohakit Metal vs. WHA Public | Lohakit Metal vs. TRC Construction Public |
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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 Global Correlations module to find global opportunities by holding instruments from different markets.
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