Correlation Between INSURANCE AUST and Thai Beverage
Can any of the company-specific risk be diversified away by investing in both INSURANCE AUST 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 INSURANCE AUST and Thai Beverage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INSURANCE AUST GRP and Thai Beverage Public, you can compare the effects of market volatilities on INSURANCE AUST 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 INSURANCE AUST with a short position of Thai Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of INSURANCE AUST and Thai Beverage.
Diversification Opportunities for INSURANCE AUST and Thai Beverage
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between INSURANCE and Thai is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding INSURANCE AUST GRP and Thai Beverage Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Beverage Public and INSURANCE AUST 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 INSURANCE AUST GRP 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 Public has no effect on the direction of INSURANCE AUST i.e., INSURANCE AUST and Thai Beverage go up and down completely randomly.
Pair Corralation between INSURANCE AUST and Thai Beverage
Assuming the 90 days trading horizon INSURANCE AUST GRP is expected to generate 0.57 times more return on investment than Thai Beverage. However, INSURANCE AUST GRP is 1.75 times less risky than Thai Beverage. It trades about 0.16 of its potential returns per unit of risk. Thai Beverage Public is currently generating about 0.01 per unit of risk. If you would invest 440.00 in INSURANCE AUST GRP on August 28, 2024 and sell it today you would earn a total of 48.00 from holding INSURANCE AUST GRP or generate 10.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
INSURANCE AUST GRP vs. Thai Beverage Public
Performance |
| Timeline |
| INSURANCE AUST GRP |
| Thai Beverage Public |
INSURANCE AUST and Thai Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INSURANCE AUST and Thai Beverage
The main advantage of trading using opposite INSURANCE AUST and Thai Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INSURANCE AUST 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.| INSURANCE AUST vs. SHIP HEALTHCARE HLDGINC | INSURANCE AUST vs. WillScot Mobile Mini | INSURANCE AUST vs. EPSILON HEALTHCARE LTD | INSURANCE AUST vs. Bumrungrad Hospital Public |
| Thai Beverage vs. Superior Plus Corp | Thai Beverage vs. Origin Agritech | Thai Beverage vs. Identiv | Thai Beverage vs. INTUITIVE SURGICAL |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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