Correlation Between President Automobile and Thai Life
Can any of the company-specific risk be diversified away by investing in both President Automobile and Thai Life 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 President Automobile and Thai Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between President Automobile Industries and Thai Life Insurance, you can compare the effects of market volatilities on President Automobile and Thai Life 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 President Automobile with a short position of Thai Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of President Automobile and Thai Life.
Diversification Opportunities for President Automobile and Thai Life
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between President and Thai is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding President Automobile Industrie and Thai Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Life Insurance and President Automobile 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 President Automobile Industries are associated (or correlated) with Thai Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Life Insurance has no effect on the direction of President Automobile i.e., President Automobile and Thai Life go up and down completely randomly.
Pair Corralation between President Automobile and Thai Life
Assuming the 90 days trading horizon President Automobile Industries is expected to under-perform the Thai Life. But the stock apears to be less risky and, when comparing its historical volatility, President Automobile Industries is 1.82 times less risky than Thai Life. The stock trades about -0.13 of its potential returns per unit of risk. The Thai Life Insurance is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 755.00 in Thai Life Insurance on September 2, 2024 and sell it today you would earn a total of 305.00 from holding Thai Life Insurance or generate 40.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
President Automobile Industrie vs. Thai Life Insurance
Performance |
| Timeline |
| President Automobile |
| Thai Life Insurance |
President Automobile and Thai Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with President Automobile and Thai Life
The main advantage of trading using opposite President Automobile and Thai Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if President Automobile position performs unexpectedly, Thai Life 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 Life will offset losses from the drop in Thai Life's long position.| President Automobile vs. Phol Dhanya Public | President Automobile vs. PTT Oil and | President Automobile vs. Pico Public | President Automobile vs. Pioneer Motor Public |
| Thai Life vs. PTT Oil and | Thai Life vs. Home Product Center | Thai Life vs. Muangthai Capital Public | Thai Life vs. The Erawan Group |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |