Correlation Between Naked Wines and Thai Beverage
Can any of the company-specific risk be diversified away by investing in both Naked Wines and Thai Beverage 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 Naked Wines and Thai Beverage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Naked Wines plc and Thai Beverage PCL, you can compare the effects of market volatilities on Naked Wines and Thai Beverage 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 Naked Wines with a short position of Thai Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Naked Wines and Thai Beverage.
Diversification Opportunities for Naked Wines and Thai Beverage
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Naked and Thai is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Naked Wines plc and Thai Beverage PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Beverage PCL and Naked Wines 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 Naked Wines plc are associated (or correlated) with Thai Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Beverage PCL has no effect on the direction of Naked Wines i.e., Naked Wines and Thai Beverage go up and down completely randomly.
Pair Corralation between Naked Wines and Thai Beverage
If you would invest 3,367 in Thai Beverage PCL on September 2, 2024 and sell it today you would earn a total of 0.00 from holding Thai Beverage PCL or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Naked Wines plc vs. Thai Beverage PCL
Performance |
| Timeline |
| Naked Wines plc |
| Thai Beverage PCL |
Naked Wines and Thai Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Naked Wines and Thai Beverage
The main advantage of trading using opposite Naked Wines and Thai Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Naked Wines position performs unexpectedly, Thai Beverage 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 Beverage will offset losses from the drop in Thai Beverage's long position.| Naked Wines vs. Diageo PLC ADR | Naked Wines vs. Pernod Ricard SA | Naked Wines vs. Constellation Brands Class | Naked Wines vs. Brown Forman |
| Thai Beverage vs. Diageo PLC ADR | Thai Beverage vs. Pernod Ricard SA | Thai Beverage vs. Constellation Brands Class | Thai Beverage vs. Brown Forman |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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