Correlation Between Prime Office and Thai Wah
Can any of the company-specific risk be diversified away by investing in both Prime Office and Thai Wah 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 Prime Office and Thai Wah into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prime Office Leasehold and Thai Wah Public, you can compare the effects of market volatilities on Prime Office and Thai Wah 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 Prime Office with a short position of Thai Wah. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prime Office and Thai Wah.
Diversification Opportunities for Prime Office and Thai Wah
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Prime and Thai is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Prime Office Leasehold and Thai Wah Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Wah Public and Prime Office 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 Prime Office Leasehold are associated (or correlated) with Thai Wah. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Wah Public has no effect on the direction of Prime Office i.e., Prime Office and Thai Wah go up and down completely randomly.
Pair Corralation between Prime Office and Thai Wah
Assuming the 90 days trading horizon Prime Office Leasehold is expected to under-perform the Thai Wah. But the fund apears to be less risky and, when comparing its historical volatility, Prime Office Leasehold is 28.99 times less risky than Thai Wah. The fund trades about -0.04 of its potential returns per unit of risk. The Thai Wah Public is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 499.00 in Thai Wah Public on September 14, 2024 and sell it today you would lose (203.00) from holding Thai Wah Public or give up 40.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prime Office Leasehold vs. Thai Wah Public
Performance |
| Timeline |
| Prime Office Leasehold |
| Thai Wah Public |
Prime Office and Thai Wah Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prime Office and Thai Wah
The main advantage of trading using opposite Prime Office and Thai Wah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prime Office position performs unexpectedly, Thai Wah 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 Wah will offset losses from the drop in Thai Wah's long position.| Prime Office vs. Quality Houses Property | Prime Office vs. LH Shopping Centers | Prime Office vs. The Erawan Group | Prime Office vs. XSpring Capital Public |
| Thai Wah vs. Charan Insurance Public | Thai Wah vs. AIM Industrial Growth | Thai Wah vs. Thai Life Insurance | Thai Wah vs. Ingress Industrial 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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